JEDDAH: Prices of reinforced bars are slightly up in the Middle East region. In December, local prices moved by $30 per ton to 40 per ton in Egypt and the UAE, a little increase was also observed in Saudi Arabia and Lebanon. This enabled Turkish and CIS producers to lift their quotations marginally. However, reinforced bar quotations in Middle East were expected to rise slowly this winter. In early December, Turkish companies offered rebar for $615 per ton to $630 per ton FOB but that price was accepted only by Iraqi consumers. Ukrainian exporters also lifted their quotations to $600 per ton to $610 per ton fob but their material is not going easily. The current price movement is a consequence of price increases for billets and scrap. In the near future both raw materials and semis are likely to go up further because of limited supply. The spread between billet and rebar price in Turkey reduced to $30 per ton to $35 per ton, so rolling mills have no other choice but to lift quotations for their products in spite of unfavorable demand. The demand for construction steel in the Middle East increased a bit compared to the near zero levels of October and November but in total the market remains weak. Turnovers in the construction industry however, are still far behind the before downturn figures. Further, a majority of the large projects are financed by governments so preference is given to the national producers of reinforced bars. Construction industry is forecast to recover before March or April 2011. Currently major requirements in rebar in the region are satisfied by local suppliers. Currently, billet seems to become more demanded commodity in the region than rebar. The cost of material from CIS and Turkey ranges from $605 per ton to $625 per ton CFR which is only inessential lower than finished steel products. Over the past few years, Saudi Arabia has become one of the fastest steel producing and consuming nation in the Middle East region. Supported by the government's initiative to build new economic cities, railways system, airports and a number of infrastructure projects, the steel consumption in Saudi Arabia is anticipated to gain an uninterrupted momentum in the near future. Supported by the increase in the number of infrastructure related projects, the demand for steel in Saudi Arabian is expected to remain strong in the near future. In the Q1 of 2010, the Kingdom's steel output rose by close to 42 percent to reach approximately 1.333 million tons. In order to ease shortages of steel rebar and check the increasing prices of the commodity in the country, the government has removed the import duty on steel rebar, thereby, creating a more conducive environment for steel consumption.
