Gulf Cooperation Council hot rolled coil market activity is returning to its pre-holiday level, particularly in United Arab Emirates. Pipemakers and re-rollers in both Oman and UAE have released their inquiries; however, in Saudi Arabia, business remains slow, Kallanish notes.

Last week in Oman, a pipemaking HRC deal was concluded for a combined 10,000 tonnes of S235jr and S275jr grades at an average price of $765/tonne cfr Sohar for February delivery. Depending on the mill, S275jr is quoted at $5-8/t higher than S235jr. The Indian supplier mill was awarded the deal thanks to its favourable location on the west coast, which means shorter lead time and lower freight cost.

In UAE, one pipemaker concluded a deal from an Indian mill at an indicative price for base grade at $750-755/t cfr Jebel Ali for a 11,000t parcel, for February shipment. The lower price for the UAE market is because the bulk vessel freight cost from India to Jebel Ali is $5-8/t lower than to Sohar in Oman.

A few deals for re-rolling and pipemaking grades are expected to be concluded this week. This will see mills in various countries revise their quotes for February and March shipments. Inquiries were being circulated by buyers on Tuesday to obtain price offers.

For the time being, Indian mills’ re-rolling grade SAE 1006 2mm+ initial offers are pegging at $750-770/t cfr Jebel Ali or Dammam, for February and March shipments. This means a $10-20/t decrease on the last week of December. Indian mills’ fob prices equate to $720-725/t. The $20/t spread between the top and bottom of the range is due to higher freight costs for east coast Indian mills. Japanese mills’ initial price offers are meanwhile at $770-780/t cfr Jebel Ali or Dammam for March shipments.

“Chinese HRC disappeared from our market. Their price is way too high. We have been hearing of ArcelorMittal Brasil’s presence in the market. Their quality has been tested and is highly appreciated in our region. When they come with competitive prices and shorter lead times they will have a chance to be preferred,” explains a senior mill official.

The sole GCC producer’s pipemaking grade S235jr offer is at $800/t and re-rolling grade for re-rollers at $820-830/t cpt UAE or Saudi Arabia for March shipment. This is found uncompetitive by buyers.