Chinese rebar is set to break the Middle East

Moves by Chinese suppliers to seek Gulf approvals threatens Turkish dominance in region

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By  Sean Cronin Published  August 19, 2006

The Turkish stranglehold on the supply of rebar to the region could soon be smashed as contractors stung by price hikes look to import from China. Rebar prices in the UAE soared by around 36% in the first half of the year, according to mesteel.com. Prices have only begun to soften in recent weeks, but are still fluctuating at around US $520 (AED1,900) per tonne —compared to around $400 per tonne a year ago. Until now, Chinese rebar has failed to make an impact on the market, with specifying consultants preferring Turkish steel, which arrives blue and rust-free and has been easier to certify. But many suppliers and contractors are now looking to buy the material from alternative sources, after some Turkish suppliers cancelled their orders and diverted shipments to Europe and the US, where they could achieve better prices. And Construction Week has learned that several suppliers in China, India and Ukraine are currently seeking approvals, which would allow their rebar to be used on sites in the UAE. Ben Bowsher, executive director at the UK Certification Authority for Reinforcing Steels (UK Cares) confirmed that the company had received several applications from China and India, as well as Ukraine and Egypt. “We certified a lot of Turkish mills for many years, so when the boom started in the Gulf, it would have been available as an approved material. “Most steel mills around the world are certified by someone. What they will try to do is use a certificate that will get them into as many different markets as possible and UK Cares is recognised in the Gulf, in Asia; wherever the British Standard is used,” he added. “Until now, people were worried about quality but now that the quality is acceptable, it will break the Turkish monopoly,” said one UAE-based rebar importer that recently shipped 10,000 tonnes of Chinese rebar. He added: “No one was really willing to take the gamble and the problem was that the Turkish suppliers dominated the market for so many years, controlling price and supply. Now traders and contractors are looking for viable alternative markets.” Local building material companies such as UBM and CICON are now ordering shipments from China, while contractors such as ETA Ascon are also looking to import from Chinese manufacturers. “The volatility in the market is one of the reasons that we have started sourcing from China and in the near future I would see new players entering the market from places like China and India,” said Mohammed Faleel, purchasing manager, ETA Ascon. “Some suppliers are very good at creating demand by not supplying for a month or two and creating shortages as a result.”

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