Riyadh-Amlak
Steel markets have seen a decline in prices during the current period as a result of the slowdown in construction activity in the Kingdom, prompting producers to lower rebar prices in an effort to stimulate the market.
SABIC has reduced the prices of its rebar products by 200 riyals per metric ton, while other national manufacturers have offered distributors preferential prices that are 400 riyals lower than the prevailing rates, with the aim of boosting sales. As a result, rebar (16–32) mm is now sold at 2,400 riyals per metric ton to distributors (down from 2,800 riyals) and at 2,650 riyals per metric ton to consumers (down from 2,950 riyals).
Sameh Abdel-Qader, «CEO of one of the national mills,» said: «The large stockpiles accumulated in warehouses are difficult to liquidate in a short period of time,» noting that demand for rebar has declined by approximately 50 percent since the start of the campaign to rectify labor conditions and the departure of many workers, which has led to the suspension of many projects and, consequently, a decline in demand for rebar. He explained that nearly half of the national factories’ monthly production of 800,000 metric tons is stored in the factories’ own warehouses. Sales, meanwhile, do not exceed approximately 400,000 metric tons, in addition to quantities imported from global markets, which further strain the domestic market. He estimated that the latest shipment imported from several countries (Turkey, the United Arab Emirates, and South Korea) and amounting to 250,000 metric tons, is currently sitting in warehouses due to the difficulty of selling it amid the current slump. He confirmed that domestic factories have reduced their production capacity over the past two months to 60 percent of actual capacity, meaning that 30 percent of production capacity is currently idle. He noted that the significant decline—or severe “recession”—affecting the market is linked to the crackdown led by the Ministry of Labor against workers violating residency and labor regulations, He pointed out that major construction companies have lost a significant portion of their workforce as a result of this crackdown, which has contributed to the suspension of many development projects at present.