Posted on 17 Nov 2022
Saudi Arabia's billet market is subdued due to relatively low rebar demand.
Induction furnace route merchant billet producers across the country have kept their prices unchanged on-week, pegging at SAR 2,175-2,200/tonne ($580-586) ex-works or delivered within the same city, Kallanish learns.
Tier-three mills have lowered their rebar quotes in Jeddah to SAR 2,450/t ($653) and in Riyadh to SAR 2,500/t ($666) but are still receiving no interest from traders or stockists. Traders stopped buying rebar from mills, selling in the retail market at below their purchasing prices to deplete their stocks.
In Jeddah, oversized rebar scrap generated by demolished buildings is offered at SAR 1,350/t and processed HMS 80:20 grade scrap at SAR 1,450/t delivered. In Riyadh and Dammam, scrap prices are SAR 50/t and SAR 100/t higher respectively than in Jeddah.
A tier-two mill booked four scrap cargoes of a combined 120,000 tonnes and is expected to receive the first of these by end-November and the rest in December. This is expected to depress scrap prices further, particularly in the Jeddah region amid the current demand absence.
"Traders are afraid of a rebar price fall while monitoring global markets. That's why they avoid booking rebar from mills. Rebar re-rollers cannot sell their material, although they are gradually reducing their quotes,” says a merchant billet producer. "Since rebar flow from producers to traders is being cut, billet demand has also gone silent."
Ex-Oman 150mm 3sp grade billet sales into Saudi Arabia continue at $505/t ex-works. In Riyadh and Jeddah, low supply availability is encouraging rebar re-rollers to book the material.
Ex-South Asia blast furnace billet offers are meanwhile at $526-531/t cfr Jeddah port for January shipment. Last week, a limited quantity of ex-Russia material was offered at $517/t cfr Jeddah for end-December shipment. “Buyers are hesitant to book Russian material as they don’t want to be caught up in sanctions,” a trader comments.
Source:Kallanish
