In recent days, several Chinese factories have reportedly stopped issuing new export offers to buyers in the Persian Gulf, as shipping conditions and insurance coverage for ships passing through the Strait remain unclear. Market participants said that freight rates for shipments to the region have already increased by about $10/ton, which means about $50-55/ton for large HRC cargoes, while the lack of security guarantees has made both buyers and sellers reluctant to conclude new deals.
The logistical disruption has also affected shipments already at sea. According to market insiders, ships that left Chinese ports and were approaching the waters of the Persian Gulf were advised to divert and unload at alternative ports outside the strait. Additional complications arose after reports of disruptions at the Jebel Ali port in Dubai, the largest port in the region, while security concerns led to staff reductions at many sales offices and logistics facilities throughout the UAE.
As a result, trading activity has actually stalled. Sources in both China and the Middle East said there were no offers or requests for new ones.
