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based long steel producer Emirates Steel Industries (ESI) produced 1.6 million metric tons (MMT) of long products, which indicates a year-on-year increase of 183 percent. The company's production of rebar accounted for 83 percent of its overall production, the rest of which is wires.
During the year in question, backed by strong local demand, 92.69 percent of the company's bar and wire output was shipped within the country, whereas exports amounted to only 161,000 metric tons.
Emirates Steel Industries is considered the largest rebar producer in the UAE, covering around 30 percent of the overall market demand for long products, while remaining demand is covered by the production of other Emirati companies as well as through imports which amounted to approximately 5.8 MMT. |
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Turkey's total steel billet exports amounted to 209,613 tons declining by 28.76 percent M-o-M and climbing by 117.03 percent. Meanwhile, the revenue generated by these exports totalled US$ 124.92 million, increasing by 258 percent compared to the same month of the previous year and down 19.52 percent.
The average export price of Turkish steel billet was US$ 596 per ton up US$ 68 per ton or 12.97 percent, indicating an increase of US$ 234 per ton or 65 percent.
On the other hand, in the first five months of 2010, Turkey's steel billet exports rocketed by 151.82 percent Y-o-Y to 1,163,786 tons totalling a value of US$ 579.61 million, up 221.68 percent compared to the corresponding period of the previous year. |
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UAE-based rebar producer Hamriyah Steel, a 80:20 joint venture of Russian steel and iron ore producer Metalloinvest and Dr Sheikh Sultan Bin Khalifa Bin Zayed Al Nahyan, the ruler and Emir of Abu Dhabi, expects to reach its full capacity of one million metric ton by February 2011, according to Hamriyah Steel's General Manager Shukhrat Nishanov.
Accordingly, Hamriyah was commissioned and is now producing around 1,000 metric tons (MT) of rebar per day. So far the plant's production is being sold in the UAE and Saudi Arabia and once production is ramped up to full capacity, more markets in the Middle East such as Iraq, will be targeted, said Nishanov.
"Right now I think the biggest concern for the market is volatility in prices but we see that demand in the Middle East is still strong," added Nishanov.
"Our company in Russia (Metalloinvest) is a very large producer of iron ore, so all of the feedstock required is shipped direct from Russia and we do not have to rely on other countries or companies to supply us," said Nishanov, adding that over 60,000 MT of feedstock is already in storage at the Hamriyah plant.
Hamriyah plans to produce about 700,000 MT of rebar in 2010, and intends to claim 20 percent of the UAE rebar market by the time it reaches its designed capacity. Hamriyah Steel is specialised in the production of rebar of 10-40 mm diameter, meeting both local and international standards such as BS4449, ASTM A615 and DIN 488. |
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Long products had a difficult week in Iran. Rebar was offered under US$ 700 per ton (Including VAT) that is around US$ 10 per ton to US$ 15 per ton lower than previous week.
Cheap imported materials are being offered at strange trends. Last week, German origin rebar, diameter 10 mm and 12 mm was offered up to US$ 660 per ton but no buyer in the market, despite the fact that supplier was ready to negotiate more and have a discount. IPE price was down US$ 10 per ton, angle and channel dropped around US$ 5 per ton.
As construction projects have stopped working and this lead to low demand, long products market is quiet. Many traders are taking wait and watch policy, as depressing global prices, limited bank credits and government policies to decrease inflation rate have increased uncertainty.
It's unlikely that market situation would change in coming weeks, as the World Cup has begun and will influence market activity.
According to the Trade Ministry, a group of six oil producing Gulf States including Saudi Arabia has decided not to levy antidumping duties on imports of South Korean steel products.
Hyundai Steel Company and other South Korean steelmakers export steel products worth US$ 350 million annually to the Gulf Cooperation Council countries (GCC) which comprises Saudi Arabia, the United Arab Emirates, Bahrain, Qatar, Oman and Kuwait. |
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Ezz Steel sees increase in demand |
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Egypt's top steel producer Ezz Steel said Egyptian demand for reinforcing steel bars would grow to 7.4 million tons from 7.2 million ton (MT), fuelled by the need for housing.
Marketing Director George Matta also said a slowdown in Europe on the back of the Euro zone debt crisis would be countered by growing demand from Middle East and US markets. "We expect rebar consumption (in Egypt) to grow to 7.4 MT, up from 7.2 MT," he said. Rebars, used in the construction industry, represented three quarters of Ezz Steel's sales in the first quarter, with flat steel accounting for most of the rest.
Ezz Steel last week posted a 78 percent year-on-year jump in first-quarter net profit to 105 million Egyptian pounds as strong domestic demand and a recovery in global flat steel prices boosted margins. "There will be negative effects on exports because of the slowdown in Europe but demand in the US and the MENA (Middle East and North Africa) region will continue to grow," Matta said. Referring to a report that the Algerian authorities would freeze Ezz Steel's planned US$ 750 million investment in Algeria, he said, "We have not heard anything from the government that indicates that anything will happen to our project."
Algeria has frozen the deal signed with Ezz Steel and was in talks with other investors including ArcelorMittal to replace the Egyptian firm. The plant, earmarked for the eastern Algerian region of Jijel, still exists only on paper. Ezz Steel said that strong domestic demand and a recovery in global flat steel prices would continue to boost margins in 2010, reversing a decline in 2009. "Improving steel prices are basically behind the market recovery," Matta said. "We will have to follow the global price hikes. As producers, we have to pass on these price increases to the market."
Analysts expect steel prices to increase in 2010 on rising raw material costs as global demand improves. Steel prices rallied strongly in the first quarter of this year, mainly driven by the rising prices of key ingredients such as iron ore, coking coal and scrap. |
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Saudi Steel sets a new record |
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Saudi Steel Profile Co. a leading steel manufacturer in Saudi Arabia, has achieved record production capacity utilisation by manufacturing 143,815 tons of hot rolled sheets and pipes/tubes at its SSP1 plant in Jeddah, an increase of 121 percent against 65,142 tons previously.
The company has also repaid SR90 million debt to Saudi Hollandi Bank. Mohamed H Zakaria, CEO and General Manager of Saudi Steel, said he hoped the company would be debt-free by the end of the year, adding that the company, a wholly-owned subsidiary of Ahmed Salem Bugshan Group, is working to increase its combined plant capacity to one million tons per annum by 2013 from current 600,000 tons per annum. The company has three plants in Jeddah and two in Yemen. Its long-term goal is to be an SR1-billion company by 2015.
According to Zakaria, Saudi Steel is already the largest in its segment of flat steel products such as angle bars, corrugated sheets, deco pipes, ERW pipes and tubes, expanded metal, flanges, flat bars, perforated sheets, studs and runners, steel sheets and steel plates.
Zakaria is upbeat about the steel industry's prospects in Saudi Arabia. He said besides the ongoing construction boom, the massive expansion of railway network throughout the Kingdom was a good omen for the industry.
"Steel consumption is going to increase tremendously," he said.
With steel accounting for about 10 percent of construction cost, steel industry is set to earn revenues of US$ 44 billion from projects worth US$ 440 billion in progress in the next five to seven year's time, he claimed.
Zakaria forecast that the steel industry in the Kingdom was due for massive consolidation with two or three major steel players dominating the market.
"The Saudi market is one of the largest in the Middle East. Though Saudi Arabia contributes only 0.5 percent to global steel output, its consumption of 500 kg per capita is much higher when compared to India's 50 kg and China's 200 kg," he said.
Total installed capacity in Saudi Arabia for SSP segmented steel products is three million tons per annum. Saudi Steel claims to have 20 percent of market share.
Nearly 80 percent of Saudi Steel products are consumed within the Kingdom. The rest is exported to neighbouring countries like Bahrain, Iraq, Kuwait, Qatar, Yemen and the UAE. Zakaria feels that Saudi Arabia has an industry-friendly environment where the government provides facilities such as the cheapest power tariffs in the world, land at a nominal cost and financing at a very low cost. |
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