Saudi HRC, wire rod quotes induce export interest
Saudi steelmakers are eyeing export markets after achieving less-than-promising first-quarter financial results and sales volumes, Kallanish notes.
This week, the steelmakers met with an Iraqi trade delegation to ramp up steel products sales to the Iraqi market, which is heavily dominated by discounted Iranian finished steel products.
Buyers, including in Europe, are showing more interest in June-rolling Saudi hot rolled coil with the CE mark, offered at $725-727/tonne fob Saudi Arabia for the re-rolling (SAE 1006) grade, and wire rod available at $620-625/t ex-works. However, due to the sudden decline in HRC quotes in the Far East, European buyers' bids are at $10-20/t lower than current offers.
Saudi rebar has started garnering more interest in the Far East – Hong Kong and Singapore – however, current Saudi rebar offers are unworkable due to dropping prices.
"Saudi steel producers have to exist in the export markets consistently. You cannot show up to sell your material when your inventory piles up. Producers should allocate 10-20% of their production to the export markets. When domestic sales decrease, you will then be more flexible in diverting sales into the export markets,” a senior trading company official comments.
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