Middle East

Over the past two months, the non-ferrous metals market in the Middle East has been affected not only by the normal factors of supply and demand but also by the USA/Iran conflict. In particular, the Strait of Hormuz is a very important route for oil and cargo movements, so any disruption quickly creates concerns within the market. Some vessels have faced delays, higher levels of risk or changes to routes, all of which has led to uncertainty for exporters, importers, scrap traders, smelters and factories across the region.

This logistics situation has had a direct effect on non-ferrous metals. Aluminium, copper, brass, lead, zinc and cable scrap all depend on smooth movement between yards, ports, smelters and end users. With higher risks to Gulf shipping routes, traders are seeing longer delivery times, higher freight/insurance costs and more difficulties in arranging shipments. These conditions have made some sellers more cautious, while buyers are trying to secure material earlier to avoid delays or shortages. Aluminium has been one of the more sensitive metals because any concern about regional supply or export movements can quickly have an effect on prices.

High oil prices caused by the blockade and regional tensions are also increasing costs in the non-ferrous sector. Fuel price hikes raise the cost of trucking, port handling, container movements and sea freight. They also affect energy-intensive industries, especially aluminium smelting, casting and metal processing. When energy and freight costs increase, recyclers and processors either try to pass the extra costs on to buyers or reduce their buying prices for scrap in order to protect their margins. This is creating pressure in the market, especially for copper and aluminium scrap, where demand for good-quality material remains strong.

Copper recyclers are still active in the market, but price volatility is making trading more difficult. When copper prices rise, more material - such as cables, motors, transformers, busbars and industrial offcuts - usually comes to the market. In the current circumstances, however, some suppliers are holding on to material because they expect higher prices whereas others are selling faster to avoid logistics delays or market risk, leading to uneven availability. Buyers are also being more selective and are focusing on cleaner, higher-yield scrap that can be processed locally with fewer problems.

Looking ahead, the Middle East non-ferrous market is likely to focus more on local processing and supply security. Recent logistics issues have underlined the risk of depending too heavily on imported raw materials or on export routes through sensitive shipping areas. As a result, regional smelters, recyclers and industrial buyers are expected to attach more importance to local scrap collection, domestic processing and keeping enough stock available. This also supports the long-term direction of the UAE, Saudi Arabia and other Gulf Cooperation Council countries where recycling and local metal-processing projects are continuing to grow.

Overall, the market remains active but more cautious than before. Demand for non-ferrous recyclables is still supported by construction, power projects, cable production and industrial growth. However, the USA/Iran conflict, the blockade affecting the Strait of Hormuz, higher oil prices and freight uncertainty are increasing costs and making trade flows less predictable. In the short term, this may lead to tighter availability and higher delivered prices for aluminium and copper scrap. In the longer term, it should encourage the region to strengthen local recycling, keeping more valuable non-ferrous material inside the Middle East and reducing dependence on outside supply chains.