Saudi Arabian rebar producers believe July-delivery rebar prices should increase on the back of increased scrap quotes and iron ore pellet premium, notes Kallanish.

"Domestic HMS 80:20 grade scrap prices increased by SAR 50-75/tonne [$13.3-20] on-week to SAR 1,400/t delivered in Riyadh district and the pellet premium for the third quarter by $15/t on Q2 to $60/t from $45/t,” a senior integrated mill official commented on the sidelines of the Kallanish Steel Forum held in Dubai on 15 June.

“Costs have increased, and from July onwards will increase further. Stockists have low inventory levels, which is a good opportunity for a slight increase in rebar quotes in the kingdom," he added.

"Mills are registering bad financial records in the second quarter, which are worse than their Q1 losses," a senior Riyadh-based rebar roller official said on Monday. "We hope based on realistic cost calculations that July rebar quotes should inch up slightly, if not be unchanged."

Last week, the Saudi benchmark mill offered an incentive on wire rod sales of a SAR 100/t project discount given for quantities above 100% of the buyer's quotas, but this did not induce much interest. The benchmark mill's June-rolling rebar and wire rod prices were each set at SAR 2,350/t ($626) delivered, with a project discount of SAR 150/t ($40) given for quantities above the eligibility rate, which varies upon customer classification.

On 18 June, a Saudi delegation, accompanied by steelmakers, began a visit to Baghdad, Iraq to boost the two countries' trade, social and economic relations.

Iraqi importers traditionally bought Ukrainian rebar as prime-quality material, but supply was disrupted after the Ukraine war broke out. For some time, Iraqi importers were seeking alternative rebar supply from abroad. They started importing rebar from two major Saudi mills and are already in talks with more for further rebar imports from the kingdom.