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Middle East

We have been witnessing a slow period for the past two months, although it has been an eventful and at times chaotic second quarter at the macro level. The geopolitical situation in Europe, the resurgence of COVID cases in China, the continuous supply chain problems and the congestion at ports have all led to disruption, slower trading and falls on the LME owing to reduced demand and supply activity.
COVID remains a persistent issue in China despite cases globally having dropped substantially, with most if not all restrictions having been lifted in many regions. The lockdowns in major Chinese cities have contributed to a slowdown across many industries, disrupting shipments and pushing metals prices even lower.

The global trading and economic slowdown is reflected in the suffering of the automotive industry worldwide, for which production remains below the norm and global sales data are on the low side owing to the effects of COVID and the recent Chinese lockdowns as well as to the ongoing logistics and energy crisis and to the semiconductor shortage which seems to have deepened as a result of the geopolitical crisis in Europe. Demand for all metals has dropped and prices on the LME have seen low levels, especially for aluminium which fell 30% to a four-month low recently.

In the Middle East, the situation is not so different as the global drop in demand for most metals has led to an easing of supply. In addition, last month saw the celebration of the holy month of Ramadan followed by Eid holidays.

Finally, I would like to take this opportunity to thank you for your continued support and the BIR for the chance to be a member of the incredible Non-Ferrous Metals board for the past eight years. It has been a great pleasure and an enormous opportunity to share a regional perspective and represent the Middle East as a board member.