After importing a significant volume of steel in 2011 from Turkey and neighboring countries, Saudi Arabia's steel demand was expected to increase also in 2012, on the back of the bulky budget for 2012 and new construction projects. Given the current sluggishness in the traditional rebar importing markets in the Middle East and also Saudi Arabia's steel import volume, it would not be groundless to name Saudi Arabia as "The shining star of the Middle East". As SteelOrbis previously reported, in 2011 Saudi Arabia's imports from Turkey totaled 707,428 mt for steel billets, 256,231 mt for rebars and 207,729 mt for merchant bars.
The strong Saudi Arabian economy, supported by high oil prices, allows the country to continue the realization of construction projects at a fast pace. The Kingdom Tower, which will be constructed in Jeddah with a height of 1,000 m is still raising the mood in the Saudi Arabian construction sector. Planned to be finished within 63 months, the Kingdom Tower will the center of the future "Kingdom City", which will be constructed in north of Jeddah.
In the first two months of 2012, Saudi Arabia imported 306,000 mt of long steel products from Turkey and its imports from Turkey are expected to increase gradually following transactions concluded in March for April and May shipments. The low long steel demand observed in other Middle Eastern markets, which are traditionally Turkey's major export markets, has caused Saudi Arabia to shine as one of the most important markets in the region. Also importing steel from Dubai and Qatar, Saudi Arabia is now the main source of demand in the Middle East.
Despite the high demand, state-controlled retail prices for rebar in the Saudi Arabian domestic market have remained at SAR 2,900/mt ($773/mt) and wholesale rebar prices are still at SAR 2,800/mt ($747/mt) - both ex-works and on theoretical weight basis. In the meantime, rebar offers to Saudi Arabia from Turkey, Egypt, Qatar and Dubai are at about $670-680/mt CFR Jeddah, while Ukrainian rebar offers to the country are at $655-665/mt CFR.