HRC export offers from North Africa have declined over the past couple of weeks, with the general market fundamentals not providing enough support for prices. In particular, despite some revival seen in the European market, HRC offers from Turkey, the main rival of North African HRC mills in terms of the regional geography, have settled at competitive levels of ($535-545/mt FOB), leading to some adjustments in offers from Algeria and Egypt. In addition, scrap prices in the region have also been softening, influencing North Africa’s production costs somewhat, while creating a wait-and-see mood among buyers.
In Egypt, the current export price is evaluated at around $530/mt FOB for November shipments, down around $5-10/mt from the targets of a couple of weeks ago. A lot of 5,000-10,000 mt has lately been traded to Turkey at $545/mt CFR or slightly lower, while the latest HRC booking to Saudi Arabia for thick gauge material has been reported at $545/mt CFR Jeddah, with over $20/mt freight, sources say.
Despite the recently announced preliminary decision on the HRC safeguard in Egypt, the local supplier is not in a rush to update its domestic prices upwards. Egypt’s domestic HRC price is still at EGP 33,000/mt ex-works including 14 percent VAT, translating to around $600/mt ex-works, according to the current exchange rate and excluding VAT.
Algeria’s indicative offers for November shipments of HRC have been reported at $560/mt FOB, down from the target of $570-580/mt FOB two weeks back. The supplier is still mainly oriented on the EU and Africa in its exports, but is not under much pressure taking into account the rather high pricing in the domestic market. Local HRC in Algeria is available at $610-615/mt or DZD 87,000/mt ex-works (9 percent VAT included).
Import HRC offers to North Africa are mainly coming from the usual markets - Asia and Turkey. In Morocco, offers from China have been reported at $535-540/mt CFR, while in Algeria they are at $535/mt CFR. The workable levels in both countries are closer to $510-520/mt CFR. Ex-Japan offers to North Africa have been hovering at around $530-535/mt CFR, competitive against China but not quite workable for domestic buyers to conclude deals. Russia is still the most aggressive supplier: its latest offers for sanctioned material have been reported at $490-500/mt CFR for November shipments. The same levels were recorded in deals for a total of around 30,000-35,000 mt in the previous two weeks, SteelOrbis has learned.
$1 = EGP 48
$1 = DZD 130