Billet
Billet size 150 mm began last week at USD726/mt on truck in Anzali port including 4% VAT. Its price in Imam Khomeini Port was USD707/mt on Monday.
When a big parcel was injected to the market, 150 mm billet price dropped by USD3/mt in Imam Khomeini Port then stabilized by Wednesday. Size 120 and 100 mm billets were offered in Azali port frequently last week which were USD712/mt and USD722/mt including 4% VAT in Anzali.
As manufacturing sector is faced with lower working hours in Ramadan, billet demand is low, but besides its supply level is dropping too, especially shortage of supply is apparent in size 150 mm, so section producers depended on this size of billet will face difficulties.
It should be noted that during first quarter of current Iranian year ( March 21- May 21 ) average monthly import level of billet was 256,000 tones but last Month ( June 22-July 22 ) 166,649 tones of billet was imported to Iran which is 26% lower than a month ago.
Since sections market sentiment is terribly bad in Iran and producers’ profit margin is too narrow, any improvement in billet market is unlikely in near future. Apart from that, exporters offer price to Iran have increased, also problem of LC’s negotiation has remained, so most of importers have stopped placing any order.
Long products
Long products market was downward last week as debar price dropped by USD2-5/mt every day. I-beam price was volatile a little. Angle and UNP prices declined around USD10/mt at the beginning of the week and the downward trend continued.
As construction market is silent in Ramadan, section demand has dropped significantly. Meanwhile high tonnages sections purchased during 21 April – 21 June in IME has been injected to market, besides import products at competitive prices made the situation worse.
During first 4 months of current Iranian Year (21 March- 22 July) around 1,259,800 tones of sections was transacted in IME which is 25% higher than purchased sections same period of last year. 261,682 tones of I-beam, debar and UNP has been imported during this period which is 54% lower than first 4 months of last Iranian Year. Still imported debar is available at Bandar Imam Khomeini at retail price of USD759/mt, which is much cheaper than retail price of domestic products in IME at USD 832/mt. At the moment the need for government controls is very necessary, anti- dumping duties or at least some fines against low price imports can help the market to become balanced.
At the moment, with high costs of raw materials and low capacity utilization rate of steel mills, their profit margins are very limited or they are losing.
Flat products
HRC 2 mm thick was transacted at USD859-862/mt including 4% VAT on truck in Anzali during last week and at some deals the price was up around USD5/mt till end of the week. HDG market is in supply shortage like last weeks and market price was strong. CRC market was quiet but its price was up around USD5-10/mt.
On Sunday last week, there was a rumor in the flat products market that, Mobarake Steel would increase supply level and also its prices in IME by Wednesday at strange levels as market participants believed. But a day later it was proved to be just a rumor. Meanwhile it made some traders to sell their inventory as worried about drops in prices. Consequently market price for HRC 6 mm thick and higher declined last week.
Generally speaking, flat products market in Iran is so depressed due to mills stoppage and lower construction projects. During last months cost price of imported flat products was higher than domestic prices, besides Mobarake steel supply level was limited.
During first 4 months of last Iranian Year ( 21 March- 22 July), around 873,182 tones of 2 mm HRC was imported to Iran, but during same period this year it dropped by 261,000 tones to 611,408 tones. In CRC market the downward trend was evident too. During first 4 months of this year import level was 963,120 MT which is 27% lower than same period last year.
But flat products supply level in IME during these months was 1,130,868 MT which shows 17% rise compared with first 4 months of last Iranian year. The rise in supply level was evident in HRC market but CRC supply level in IME dropped significantly during last month.
In import market offer prices were unchanged during week 31 and some sizes are heavily in shortage. Market participants mostly expect flat products prices to increase after Ramadan.
Iran Steel Service Center