The sluggish domestic rebar demand in the United Arab Emirates (UAE) which began with the influence of Ramadan has been replaced by livelier activity after the UAE announced its participation in the boycott of Qatar on June 5. It is also observed that buyers have accelerated their domestic rebar purchases in expectation of a decline in the volume of rebar supply.
UAE-based steelmaker Emirates Steel Industries (ESI) has announced its rebar prices for June-July production. Accordingly, ESI has increased its rebar price by AED 78/mt ($22/mt) to AED 1,775/mt ($484/mt) ex-works for June-July production, as compared to its previous price for May output materials. On the other hand, market sources mention that the increase in ESI's rebar prices is higher than initially foreseen, supported by expectations of Qatar leaving the UAE market due to the diplomatic crisis which erupted yesterday, June 5.
Under these circumstances, UAE-based traders have increased their domestic rebar prices by AED 45/mt ($12/mt) week on week to AED 1,760-1,770/mt ($480-482/mt) delivered to customer. Additionally, traders' inventory levels are seen to be low, and so market sources state that domestic rebar prices may increase further in the coming days.
On the other hand, having experienced problems for some time due to tight rebar supply in their domestic market and having failed to take an active role in the export markets, Turkish steel mills are still waiting for uncertainties in their domestic and export markets to be resolved. As a result, once again no new Turkish rebar deal has been heard in the UAE market this week. If Arab countries stop purchasing rebar from Qatar, Turkish steel producers - with the support of higher domestic rebar prices in the UAE - may again have the upper hand in terms of price and may return to the UAE market.
$1 = AED 3.67