A major Indian steel producer reported that, in agreement with its customers in the Middle East and Europe, it has temporarily halted the majority of its shipments and cargoes. The company anticipates that the situation will not change in the short term and continues to explore alternative routes to maintain supply.
Meanwhile, a Taiwan-based producer highlighted a slowdown in European sales, noting that the market is generally in a holding pattern. During this period, security and logistical issues in the Red Sea have forced some suppliers to reroute via the Cape of Good Hope; transit times have increased by 10–20 days, and order cancellations and delays have risen, particularly for low-margin and time-sensitive products. While some suppliers continue shipments despite higher costs, others have suspended deliveries or are renegotiating terms.
A Malaysia-based source noted that, due to maritime security risks in the Middle East, alternative logistics solutions are being sought, particularly in countries dependent on the Strait of Hormuz, and that the UAE is planning a strategic land corridor to bypass this high-risk maritime route.
An India-based producer shared that freight costs to Europe have risen sharply due to higher oil prices and longer routing choices. Conversely, another China-based trading company reported that sales in Europe remain at previous levels, with some customers awaiting lower freight costs, and that advance payments of 30% have become increasingly common for new orders.
Supply and logistics challenges in the Far East steel sector are expected to persist in the short term, while congestion in the Strait of Hormuz is significantly slowing shipments. Approximately 1.2 million tons of cargo are currently waiting at ports and anchorage areas, encompassing iron ore, pellets, concentrates, and steel products. Companies are seeking solutions such as alternative routes, payment arrangements, and inventory management to mitigate disruption risks and enhance operational flexibility.
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