During the week of July 4–10, weak demand and subdued trading activity continue to pressure steel prices across the MENA region as the summer slowdown weighs on market sentiment. While Egypt has shown limited signs of recovery following recent developments in the foreign exchange market, geopolitical risks in the Middle East and cautious purchasing activity across Africa continue to restrain regional trade.
Momentum that emerged in Egypt's steel market during the final week of June has been supported by the appreciation of the Egyptian pound (EGP) against both the US dollar and the euro. The stronger local currency has reduced import costs, contributing to a gradual improvement in market sentiment. However, market participants caution that the government's ongoing external debt repayments could once again place downward pressure on the Egyptian pound in the coming months. Industry sources also believe the Central Bank of Egypt is unlikely to allow the US dollar exchange rate to fall significantly below the EGP 48 level. At the same time, a stronger Egyptian pound could reduce the export competitiveness of domestic steel producers.
Despite the improvement in currency conditions, demand in the semi-finished steel segment remains weak. Billet trading continues to be sluggish, although the stronger Egyptian pound has led to modest price reductions. Soft demand for finished steel products remains the market's primary challenge. According to market sources, producers have begun releasing inventories accumulated at ports while accelerating new shipments in an effort to stimulate commercial activity.
In terms of pricing, hot-rolled coil (HRC) in Egypt is currently trading at $707/t EXW, while rebar stands at $658/t EXW. Current price levels suggest that, despite the recent improvement in market sentiment, domestic demand has yet to recover to the levels expected by market participants.
Across the Gulf region, demand for long steel products remains subdued as seasonal summer conditions continue to weigh on construction activity. In Jordan, Al-Moasron's rebar prices are assessed at $708-712/t, while in Kuwait, Kuwait Steel is offering rebar at $668-674/t EXW and Al Oula Steel at $666-672/t EXW. In Algeria, rebar prices remain stable within the $738-745/t EXW range, with producers maintaining price levels despite limited trading activity.
The regional scrap market continues to display relative stability. In the UAE domestic market, HMS 1/2 scrap is trading at $217.8-231/t, HMS Super at $259-261.5/t, and shredded scrap at $286-293/t. Processed heavy scrap grades are assessed at $265-286/t, while end-cut scrap is priced between $294-299.5/t. The largely stable scrap price environment indicates that supply and demand remain broadly balanced.
Raw material prices in Saudi Arabia continue to vary by delivery region. HMS 1&2 scrap is priced at $515/t CPT delivered to the Eastern Province and $470/t CPT delivered to Jeddah, while shredded scrap delivered to Riyadh is trading at $453/t CPT. Regional logistics costs continue to be the primary factor behind these price differentials.
Geopolitical developments remain an important factor shaping market sentiment across the Middle East. Renewed tensions around the Strait of Hormuz have weakened market confidence, particularly among Gulf countries. As uncertainty persists, buyers continue to adopt a cautious purchasing strategy, while subdued demand continues to exert downward pressure on domestic steel prices.
In the semi-finished steel segment, Libya's HBI export offers at $367/t FOB remain highly competitive. Meanwhile, Iranian billet export offers continue to hover around $415/t FOB, highlighting ongoing competition within the MENA semi-finished steel market. Nevertheless, weak finished steel demand continues to limit producers' ability to implement price increases despite persistent cost pressures.
Across Africa, market conditions remain generally stable. Major buyers continue to follow a wait-and-see approach, while Chinese billet offers to Kenya and Ethiopia have remained largely unchanged at around $532/t CFR. In South Africa, robust domestic demand continues to support trading activity, with hot-rolled coil trading at $885/t, cold-rolled coil at $958/t, plate at $988/t, rebar at $725/t, and scrap at $240/t.
Overall, the MENA steel market remains cautious as seasonal demand weakness and geopolitical uncertainties continue to weigh on market fundamentals. Although improving foreign exchange conditions in Egypt have provided short-term support to trading activity, weak end-user demand and persistent global uncertainties are preventing a meaningful recovery in regional steel prices. Looking ahead, demand trends during the third quarter, together with developments in regional currency markets, are expected to remain the key factors determining the direction of the MENA steel market.
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