Steel prices in the UAE are expected to tumble further for want of demand amid uncertainly in the market.
The price of rebar from Turkey is currently at about $620 (Dh2,277) per tonne CFR Dubai, compared to about $720 four weeks ago.
The downward slide is expected to continue, according to Karel Costenoble, Manager at Mesteel, an online steel intelligence portal.
"The prices are likely to come down further, mainly due to reduced scrap prices. The demand has not picked up and is falling further and there is still uncertainty in the market. Many people thereby prefer to defer their purchases," he said.
According to him, most of the other steel products are also indicating a downward trend. "Hot rolled coil from China has fallen from $710 CFR Dubai two weeks ago to $660," he added.
Prices of reinforcing bars in China last week posted the worst decline in at least eight months. Prices of the steel product used in construction fell 4.7 per cent to 4,284 yuan (Dh2,303) a tonne.
Meanwhile, according to a senior industry official, globally steel prices have corrected five per cent in the past three weeks. In an interview to news channel CNBC-TV18, JJ Irani, Director of Tata Sons, said China, the world''s largest steel market, has stopped growing. "The high growth rate in China was unsustainable," he said.
However, Irani said the Chinese will not cut back on steel consumption. "They will continue to produce between 500 and 600 million tonnes and will also continue to use that much."
Going forward, Irani said steel prices will remain highly volatile. The fall in demand has also seriously affected the price of scrap. According the latest EUWID market report, the absence of demand from Turkey has triggered a sharp plunge in ferrous scrap prices on the German market in May.