Posted on 19 Dec 2024
Saudi Arabia’s benchmark mill has extended the validity of scrap purchase orders from 16 December until the end of the month, which has disproved rumours of falling scrap prices.
Saudi billet prices are experiencing a slight downward trend, although this is based solely on the rumour that scrap prices will fall, which has not materialised.
Relying on these rumours, billet buyers attempted to push prices down; however, only a few scrap suppliers reduced their prices, by SAR 20-25/tonne ($5-7) on-week, while others maintained their current pricing levels, Kallanish notes.
In addition to Arkan Steel bringing new capacities on stream in Riyadh and Al Kharj in January and February, Watania is expanding production and Bunyan Steel is commissioning output. Scrap demand will therefore increase and the expectation of a fall in domestic scrap prices may be wishful thinking.
This week, a mill located on the east coast that operates induction furnaces made a special deal for 4,000 tonnes of 100mm 3sp billet at SAR 2,070/t delivered to Riyadh. This equates to SAR 2,020-2,030/t ex-works. Additionally, another supplier sold a small cargo of 1,000 tonnes of 130mm 4sp billet (manganese 0.6%) for SAR 2,110/t delivered to Riyadh, which equates to SAR 2,070/t ex-works. Both deals are for prompt shipment.
In Riyadh and Al Kharj, billet suppliers are still targeting prices of SAR 2,050-2,060/t ex-works for 3sp billet. Meanwhile, in Jeddah, locally produced 130mm 3sp billet is at SAR 2,100/t ex-works.
Imported billet from the Far East and India for 150mm 3sp is priced at $480/t cfr (liner out) for February shipment, with a minimum parcel size of 30,000t. However, buyers are hesitant to book at these levels, aiming for prices at or below $475/t cfr for 0.6% manganese content 150mm square billet.
Delivered scrap prices in Jeddah are at SAR 1,450-1,470/t for HMS and SAR 1,530-1,540/t for premium. In Riyadh, pricing is at SAR 1,490-1,530/t for HMS and SAR 1,540-1,550/t for shredded and premium scrap. Furthermore, buyers in Dammam are paying SAR 1,500-1,550/t for HMS.
Source:Kallanish
