China’s steel export demand weakened in the week to March 6 as uncertainty over the ongoing Middle East conflict lingered in the market, while congestion at some ports likely slowed down shipments, according to Asia-based traders and mill sources.

Steel export loading volume at Chinese ports totaled 1.56 million metric tons over March 1-5, down 14% year over year, according to S&P Global Commodities at Sea data.

Cargoes loaded for shipments to the Middle East, Mediterranean and South Asia fell by 23% over the same period, the data showed.

Market participants said it was risky to book cargoes to the Middle East and nearby regions without a clear timeline for when the conflict might end.

Several shipments were either canceled or delayed for now, said trader sources.

“The current logistics are significantly impacted [by the Middle East war]. Our own shipments of hot-rolled coil to the UAE are currently being held at the port,” said a Singapore-based trader, adding that other traders may be contemplating whether to load their ships.

Rising freight rates might be another factor that kept buyers waiting, according to the sources.

“Export prices are at similar levels across mills in China. The major determining factor of price is freight rate now,” said a Hangzhou-based trader, estimating a $5-$7/mt surge in freight rates seen so far.

Concurrently, port congestion in northern China likely slowed shipments, the sources said.

Due to recent cold waves, the situation of the frozen port in Bayuquan was heard to be worse than in previous years, impacting the efficiency of cargo loading and unloading, according to a northeastern mill source.

Steel price volatility and fluctuating foreign exchange rates also added to the complexities of the current market, leading both suppliers and buyers to assess the situation more carefully before making any decisions, according to some China-based sources.