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UAE: Ferrous scrap index drops $2/t w-o-w as buyers remain absent during holidays

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Melting Scrap

BigMint Bureau

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6 Dec 2024, 19:23 IST

UAE: Ferrous scrap index drops $2/t w-o-w as buyers remain absent during holidays

AGSI expanding long-rolling capacity

Spread between EU HMS CFR India and UAE HMS narrows to $18-20/t

The UAE scrap market saw dull activities this week as the market remains closed due to the long holiday for Eid Al Etihad and the National Day holiday. BigMint's bi-weekly assessment recorded a slight decline of AED 6/tonne (t) ($2/t) w-o-w in HMS (80:20) processed tags, which stood at AED 1,238-1,240/t ($337-338/t) DAP Abu Dhabi.

For HMS processed scrap, prices were hovering between AED 1,240-1,260/t ($338-343/t), while shredded scrap prices are at AED 1,270-1,280/t($346-348/t), as per market participants.

The last workable levels for processed HMS scrap were at around AED 1,240-1,250/t ($338-340/t), with shredded scrap ranging between AED 1,265-1,270/t ($344-346/t) DAP.

In BigMint's week 49 market survey, weak trade activity was observed, with approximately 2,000 t of shredded traded at AED 1,260-1,275/t ($343-347/t), followed by 2,000 t of HMS processed traded at AED 1,235-1,240/t ($335-339/t) DAP Abu Dhabi.

Arabian Gulf Steel Industries (AGSI), based in the United Arab Emirates, is set to expand its production capabilities with the launch of a new long-rolling capacity. This expansion will enhance AGSI's ability to meet increasing demand in the regional market.

The UAE export market witnessed dull inquiries. Offers for HMS and PNS mix were at $380-385/t CFR Qasim. A Dhaka-based buyer said HMS/PNS offers were at $395-400/t on a CFR Chattogram basis.

HMS (80:20) spread

The average spread between CFR Nhava Sheva HMS (80:20) from Europe and UAE local HMS (80:20) processed scrap dropped to approximately $18-20/t. Imported HMS prices for CFR west coast India declined to $355-357/t, while UAE processed HMS offers dropped to $338-339/t DAP.

Dana Steel, based in the UAE, is expanding its presence in the GCC region, with plans to establish a new facility in Saudi Arabia by 2025. This move aims to capitalise on the booming construction sector in the region. Dana Steel currently operates eight factories in the UAE and is building a ninth in Khalifa Economic Zones Abu Dhabi (KEZAD). The Saudi facility will manufacture products like roofing and sandwich panels and include a galvanising line. The company, which holds a significant share in the UAE market, is also expanding capacity with a 750,000 tpy cold-rolled complex at KEZAD to reduce reliance on imports. Dana Steel exports to over 50 countries, including the US and Europe, further solidifying its market presence.

Outlook

In the coming days, many steel mills and processors are expected to remain active, with inquiries for scrap likely to rise as businesses prepare for the next production and contract cycle. The recent increase in rebar prices by benchmark mills is expected to drive a slight uptick in scrap prices.