The Gulf Cooperation Council (GCC) is experiencing a notable increase in Hot Rolled Coils (HRC) imports, driven by soaring sea freight expenses. Reports indicate that Far East-origin HRC prices in the GCC have been steadily climbing, with a weekly increase of $5-10 per ton.
Factors Driving the Price Increase;
Sea Freight Rates:
Over the last two weeks, sea freight rates have surged by $8-10 per ton. The sharp rise in shipping costs, coupled with the absence of Indian mills in the market, has further exacerbated the situation. These increased shipping costs directly impact the overall landed cost of imported HRC.
Far East-Origin HRC Offers:
Offers from various origins in the Far East have contributed to the price surge. The GCC region has witnessed a consistent upward trend in HRC prices due to supply dynamics and market sentiment.
Additionally, it's worth noting that prices are based on CNF Jebel Ali or Dammam ports. For Jeddah shipments, an additional $8 per ton is added.
Ex-China Mill Hikes: In another development, Ex-China mill has hiked 2mm SAE 1006 grade offer to $600 per ton, further contributing to the upward pressure on prices.
The spike in HRC imports underscores the challenges posed by escalating sea freight expenses on the region's steel market. As stakeholders navigate these challenges, they are compelled to reassess their sourcing strategies and adapt to the changing market dynamics.
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