Global steel prices up again, increasing $72 per ton, “NBK” ‎keeps market stability

Report conducted by “Maaal” revealed that rebar prices rose during the past December and January, to record about $700 per ton, an increase of $72 from their levels in November 2022, supported by expectations of the return of the Chinese economy to strong growth in the year 2023 after a series of closures that it witnessed within the framework of Fighting the waves of the Corona pandemic, while local companies maintained the stability of iron prices locally.

According to the report, the global reinforcing steel market witnessed a variation during the first half of 2022 due to the state of the global economy affected by the Russian-Ukrainian crisis, and the closures in China due to “Covid 19”, while the market returned to a gradual decline during the second half of last year, as the increase in supply contributed Of the iron ores globally, the price of rebar decreased by 20% during the period from July to the end of November 2022.

The global rebar prices (Turkish rebar) were at their highest historical levels during the month of April 2022 at $982 per ton FOB (not including freight cost) against the background of the Russian-Ukrainian crisis, however, during the second half it witnessed a series of declines, to record a ton of $628. per ton at the end of last November, and with expectations of demand growth in China, prices returned to rise during the months of December 2022 and January 2023, to record the beginning of February 2023 about $700 per ton, to record an increase of $72 per ton, an increase of 11.5%.

Locally, according to the data of the General Authority for Statistics, the average price of a ton of iron in the Kingdom declined to the level of 3327.76 riyals per ton by the end of December 2022 (the latest available statement), compared to 3402.80 riyals per ton in November 2022, a decrease of 75.04 riyals, and a decline of 2.2% on the basis of Monthly. On an annual basis, the average price of a ton of iron in the Kingdom decreased by 7% at the end of 2022, compared to its price at the end of 2021, which amounted to 3578.05 riyals.

Consequently, the national companies have largely maintained the stability of the local market prices in light of the quality of the local product, in addition to the depth of the national industry that relies on the local component extracted from iron ore in local quarries to manufacture pellet, unlike other countries in the region that relies with a large part of its production on imported pellets, and thus is affected by local market developments.

Global markets suffer from a decrease in supply from Ukraine as a result of the Russian-Ukrainian war, as Ukraine is the fifth largest exporter of iron ore in the world, with an export volume of about 17 million tons in 2021 before the war, while it declined by 35% during the year 2020 to record about 11 million tons.

Ukraine is the main source of billet ore for many countries in the region, especially those countries in which rolling mills are spread based on importing billet, rolling it and converting it into reinforcing iron, so 8% of Ukrainian iron exports go to Egypt, 4% to Algeria, 3% to Iraq and 3% % for Lebanon, and therefore those countries witnessed significant increases in rebar prices in varying proportions. Most countries in the region import Turkish reinforcing steel, which is one of the competing sources of national iron in the region’s markets.