After unprecedented hike last 30 days, the steel market paused last week in most the markets in Middle East as the buyers went into hibernation and trade remained extremely thin.
It seems that the shock of this surge put the buyers, especially projects, in a quandary as they have to review their project costs. As a result although the sellers and stockiest continued to offer at new levels, most of the buyers abstained from the market.
In other words, the limited demand of steel has been further hit in the region as the steel prices increase was certainly not demand driven and was a result of hype created on cost push as well as surging import offers.
The highest surge has been in the prices of rebars, which is an essential component for construction activity. Rebar prices have zoomed, in last 30 days, by 35% in Bahrain, 37% in Kuwait, 50% in Saudi Arabia and 46% in UAE.
As a result respective governments are quite concerned on this surge and are planning to bring in some order to the market. On the other hand, buyers are hoping that this frenzy would end in some time and they would be able to resume buying steel at reasonable levels for their projects.
Last week movement
The Middle East Long Product Price Index MLPPI remains unchanged this week whereas the Middle East Flat Products Index MFPPI also the same. The overall price index Middle East MEASPI remains the same.