The North African HRC market has seen an upward adjustment of domestic prices in Algeria while many expect Egypt to follow suit due to currency fluctuations and the development of the general market situation in the region. The US-Israeli attack on Iran caused the escalation in the MENA region, which has had an immediate and continuing effect on the cost of maritime operations, resulting in higher delivered steel prices from Asia to Turkey, North Africa and generally the Mediterranean region. In such a situation, HRC export indications from Algeria and Egypt have also been raised, in line as well with ex-Turkey offers. However, both these North African countries are not in a rush to sell nowadays, aiming to see a clearer market picture. Import offers to North Africa have naturally increased, with no interest revealed by buyers yet.
In Egypt, the domestic HRC price has remained at EGP 35,000/mt or $590/mt ex-works, down by around $50/mt on US dollar basis, following the decline of the exchange rate from $1 = EGP 48 at the end of February to $1 = EGP 52 at the moment. “The whole [situation with Iran] among the rest has an impact on the freight rates and I think we should see upward HRC offer adjustments here in Egypt, considering also higher prices generally in the outside market,” a trading source told SteelOrbis.
In Algeria, the local HRC producer has increased offers for first time in several months - by DZD 3,000/mt to DZD 91,500/mt ex-works, while the US dollar equivalent has climbed by $10/mt amid currency fluctuations to $637/mt ex-works ($1 = DZD 131.7).
As for exports, both Algerian and Egyptian mills are refraining from active offerings, aiming to evaluate the situation more clearly. Sources report the target levels from Algeria would be no less than $590-600/mt FOB for May shipments. The latest price levels from Egypt have been reported at $600-610/mt CFR Turkey or, according to estimations, at $585-590/mt FOB. However, at the moment the Egyptian mill is not offering HRC for export.
In the import segment, ex-Russia prices to North Africa have increased from $480-485/mt CFR to $490-495/mt CFR for April and May shipments. In Lebanon, according to sources, Russian HRC is available at $500/mt CFR, while in Israel it is offered at $500-505/mt CFR. In the meantime, ex-China HRC offers to Egypt stand at $520-540/mt CFR, while in Turkey they stand at $530-545/mt CFR.
Local HRC prices in Egypt include 14 percent VAT, while local prices in Algeria include nine percent VAT.