“Experts: How to Take Advantage of Global Crude Prices Decline in the Local Market”

Experts: Taking advantage of the global decline in crude prices depends on saving the dollar locally

The prices of selling iron to consumers in the local market have declined during the current period, with the presence of directives for factories to provide enough supply for the needs of the market, which contributed to reducing prices by a value ranging between 4 and 5 thousand pounds per ton of reinforcement, according to dealers in the iron market, expecting the continuation of calm in local prices in The global price of a ton of iron continued to drop to $102.
The price of iron ores in the global stock market has declined to $102 now, compared to $150 per ton last year.
Ayman Heikal, director of Al-Ula Steel Factories Group, said that iron prices have declined in the local market during the current period, so that the average price of a ton of reinforcing steel is about 36 thousand pounds, compared to 40 and 41 thousand pounds last month, as a result of the state’s directives to companies to provide part of the production to the markets. local.
Heikal expects that the prices will continue to calm during the coming period if the supply continues in this way, especially with the decline in the prices of iron ores in the global markets, but he confirms that the crisis still depends on the possibility of providing the dollar needed to import production raw materials.
He explained that there were instructions from the political leadership of the factories not to export the majority of the local production and to pay attention to the internal market, which contributed to the provision of supply, and the decline in the selling prices of iron to the consumer, indicating that the major factories such as Ezz, Al-Marakibi and Suez Steel used to direct most of their production for export, but recently a part was directed From production to the domestic market.
For his part, Ahmed Al-Zaini, head of the Building Materials Division at the Cairo Chamber of Commerce, said that the selling prices of iron to the consumer fell by about 4 thousand pounds per ton, to reach between 38 and 39 thousand pounds, compared to about 42 thousand pounds last month, explaining that the decline in selling prices to the consumer and not in the factory price.
He predicted a 20% decrease in iron prices in the local markets during the coming period in the event that the regulatory bodies continue to monitor the markets, “If the regulatory bodies carry out inspection campaigns in the markets, prices will drop by 20% within 48 hours.” but slightly.
Al-Zaini appealed to consumers to wait for the purchase decision, stressing that prices will drop further, while adhering to receiving the invoice upon purchase to counter the exploitation of merchants, and to ensure receipt of the indicative price set by the company for sale to the consumer.
He explained that the drop in crude “pallet” on the London Metal Exchange to the level of $102 per ton during last week’s trading, compared to $150 6 months ago, would naturally lead to a decline in prices locally, but the trend is for export and the lack of supply, and the dollar needed for import limits the benefit. He added that “the fair price of iron in Egypt should not exceed 30,000 pounds compared to international prices.”
A report issued by the US investment bank Morgan Stanley predicted that iron ore prices would decline by 28% from their level in April, to be sold at $90 by the end of this year, supported by the decline in demand for steel in China as well as production.
For his part, Muhammad Hanafi, director of the Chamber of Metallurgical Industries in the Federation of Industries, believes that the local markets will not benefit from the decline of metal ores in the global markets by 20% in the current period, until things become clear, as a result of the lack of dollars needed to import production raw materials, in addition to the high prices. Exchange of the dollar against the pound.
Scrap prices declined globally by $13 in trading this week, to record a ton of $390 per ton, compared to last week, according to global steel market trading prices, while steel billet prices ranged between $530 and $575 per ton, and reinforcing steel prices ranged between 640. And 650 dollars per ton.