With the upcoming holidays in the Turkish and Middle East rebar markets, end-user demand level in these regions has this week registered a decline. The price levels from the mills in Turkey were at TRY 900/mt ex-works including VAT ($485/mt, excluding VAT) early in the week. However, towards the end of the week, the rebar prices of the Turkish traders have softened to TRY 790/mt ex-warehouse including VAT ($425/mt, excluding VAT) in the local market. There will be no holiday for a long time after these upcoming holidays in the Turkish and Middle East rebar markets, and it is expected that both prices and end-user demand will likely see more stable movement in the future in these markets. However, the possibility of a stable upward rebar price trend in Turkey entirely depends on foreign demand for Turkish rebar.
The export rebar offers of the Turkish mills have this week been at levels of $450-460/mt FOB. Also, the price levels in the Turkish export markets and the price levels mentioned by the mills in the Turkish domestic market have this week generally showed close similarity.
Rebar prices in the Middle East (particularly in the UAE) have remained almost unchanged over the last four weeks, thereby helping to boost the confidence of both traders and end-users in the market. If the rebar price levels in the local UAE market, which have been at AED 1,800-2,000/mt ($490-545/mt) delivered to site for four weeks in a row, increase in line with end-user demand, local traders may then lean towards the Turkish rebar producers' offers.
Rebar prices have this week decreased by approximately $40/mt in Yemen compared to last week. The rebar prices in this country have this week been standing at $610/mt on theoretical weight basis. End-user demand has this week also weakened in Yemen due to the approaching holidays.
Meanwhile, rebar supply is still at higher levels compared to demand in Saudi Arabia. Local producers in this country, who have not been able to export, are currently experiencing hard times since local end-user demand has not reached the desired levels.
As for the Syrian rebar market, it is currently following an unstable trend. While the announced prices in this market were at high levels in the early days of the week, prices have been decreasing coming up towards the end of the week. Local production rebar prices have this week been at SYP 27,000/mt ($586/mt) ex-works in the local Syrian market.
Rebar demand from the Middle East will be very important for the region's neighboring countries in 2009. Considering the sluggishness in the European and the US rebar markets in 2008 and the Turkish export deals to Africa (which did not involve large tonnages), Middle East rebar demand, which was behind the price boom of the first six months of 2008, provides hope for the rebar suppliers to this region. Also considering the fact that Turkey is the biggest rebar supplier in the region and the biggest scrap consumer in the world, the Turkish mills may give direction to the Middle East rebar market in the event of strong demand arising from the Middle East in 2009.