Domestic demand for long products in Saudi Arabia has been gradually recovering as the situation regarding the Covid-19 pandemic has been easing gradually. Construction works are reviving, which has been reflected in positive trade, in the wire rod segment specifically. In the meantime, the impact of the increased import tax due to come in force today, June 10, is still unclear.
Trading companies and stockists in Saudi Arabia report that business has become livelier as contractors’ operations have been gradually coming back to normal rates. The domestic wire rod price from Hadeed has been rolled over for June production at $507/mt (SAR 1,900/mt) CPT, sources stated, but the level may increase, hence higher demand and strong raw material prices globally.
In the import segment, offers from the UAE have been coming at $472/mt (AED 1,734/mt) delivered to Dammam, SteelOrbis has learned. Egypt’s supplier has been in the market with offers at $470/mt CFR Jeddah and $480/mt CFR Dammam for July shipments, but the levels may be increased soon if the positive situation in the market is sustained. No offers have been reported from India or China this week and if there were the interest would have been minor, SteelOrbis understands.
According to sources, the restriction due to come into force from June 10 has not yet been confirmed by any customs’ notifications. “There is no news since it only starts today. There are rumors that it has been deferred to an indefinite period. We are yet to see what happens,” a trader said. “The effects of the new duty have not appeared so far, but raw material prices are still controlling the trend,” a wire rod seller to Saudi Arabia told SteelOrbis.
$1 = SAR 3.75