Billet
Billet market experienced a volatile week in Iran. Imported billet started the week at USD746-750/mt including custom duty and 4% VAT but then was up to USD765/mt or more due to higher exchange rate. Traders who had bought before at lower prices and their cargoes had been shipped but not released from custom office yet, offered billet for 10-15 days delivery. This trend combined with sadness in sections market made billet market silent. So by Wednesday, the on the way cargoes of 150 mm billet were offered at USD746/mt for 10-15 days delivery time.
Foreign suppliers are not active in Iran market because of Christmas holidays, but latest offer price was around USD670/mt cfr Northern ports.
During last 2 months around 2 million tones of billet have been imported to Iran. At the current situation it is not enough for domestic consumption till end of current Iranian year (around next 3 months). In the last Iranian month (20 Feb-19 Mar) billet shortage would be stricter.
Domestic billet has been transacted at USD737-764 depending on size and quality but at limited tonnages during last week.
Long products
As sections prices had surged upward suddenly during a week ago, by Saturday last week debar price dropped by USD7-9/mt. It was expected that this trend continue due to low demand and sudden surge in prices. But price of other long products especially I-beam was upward. Debar price was upward too after Sunday and the trend continued till end of the week.
Domestic traders mostly think that they should focus on domestic products due to more limitations of importing and volatile exchange rate. As a reason Isfahan Steel mill was faced with 150,000 tones demand for its sections on Sunday. Average debar price in Ahvaz market for diameter 8-32 mm was around USD845/mt at the beginning of the week but finished the week at USD 860/mt including 4% VAT. For Size 14-25 mm in Isfahan market the price changed from USD870/mt to USD867/mt during last week. It should be noted that by middle of the week prices became downward as market resisted against upward trend.
Angle and channel were in the same trend up by USD5-9/mt then became downward. Domestic mills are trying to increase prices as they are in shortage of raw materials and their higher prices, but due to lack of demand market cannot accept higher prices. Maybe it needs a week time for gap between mills expectations and market potentials become closer.
Flat products
Hot rolled coil thickness 2 mm was priced USD868/mt including 4% VAT by beginning of last week then dropped by USD9/mt on Sunday. Both of sellers and buyers were confused. Prices were volatile till middle of the week after that became stable at USD622/mt but demand was so limited.
In import market CIS origin 2 mm HRC was offered at USD670-680/mt for 50 days delivery, which due to current payment terms, cost price would be higher than domestic market levels unless it would be imported by LC. Other sizes were volatile in price and by Wednesday Oxin steel mill flat products prices dropped USD9/mt but Mobarakeh steel products were upward each day during the week. HRC thickness 15-40 mm were at maximum USD700-710/mt cfr Anzali till a week ago but suppliers were so limited as payment terms is being considered.
CRC price started the week by USD45/my rise. As its supply level is limited and CRC price is dependent on exchange rate, so it increased each day by exchange rate increase. HDG price was stable as it has been increased during last current weeks and market couldn''t accept more increases. Besides, sellers were not interested in making deals. AS CRC market is facing with low supply in domestic and import market, so its shortage will continue during coming months.
It is expected that steel products prices increase by 10-30% in first quarter of coming Iranian year (21 Mar-21 Jun) which would be due to higher cost price not higher demand. This trend would be harmful for suppliers, traders and consumers. If the government''s current policy in Iran Steel market doesn’t change, higher raw material prices will damage steel production strictly and this won''t be easily recover next year.
Iran Steel Service Center