Billet
Billet market experienced a stable week due to 2 main reasons including:
1- Stability in Exchange rate
2- Fixed long products prices
Billet size 150 mm was priced at USD710-715/mt on truck in Anzali including 6% VAT, it reached also USD719/mt by end of the week. Turkish and Korean origin billet was transacted at USD698-699/mt on truck in Imam Khomeini port including 6% VAT.
Billet market was in wait and see policy, imported billet is priced at up to USD550/mt cfr Northern ports and maximum cost price with exchange room rate would be Rials 16000000/mt (USD646/mt).
Getting needed currency from exchange room is not easy for traders. Although, Importing with open market currency is not affordable at all, so domestic billet has been used despite imported one. Besides, lower production in domestic market has helped prices to stabilize.
At the moment Iran Economic sentiment is being affected by politics due to Presidential Election in next month. But traditionally wait and see policy in the market will be ended with higher prices due to market inventory shortage.
Slab price from domestic mill Khouzestan Steel Mill increased at IME during last week by USD57/mt, though some market participants are expecting the mill to increase its billet price in coming days.
Long Products
Long products market improved a little during last week, prices were up around USD8/mt by help of ex-rate. By Wednesday ex-rate started declining, so long products market was silent and fixed prices of domestic mills for supplying at IME in coming weeks helped market to stabilize.
Iran long products market is not interested in any price increase as warehouses are filled with cheap purchased inventories from last Iranian Year. Besides low demand has lead to lower liquidity in the market.
During last 3 months, investors have changed their interest to stock, property and currency markets, so transactions levels are very limited at the moment.
Domestic producers are faced will very limited profit margins at the moment. The gap between domestic billet price and base price of debar at IME is around USD20-40/mt which would be equal to loss for the mills. Market participants expect long products prices to improve after presidential election in coming Iranian Month (14th June).
Flat Products
Hot rolled coil market was downward during last week in Iran. HRC 2 mm thickness was priced at USD941/mt by Saturday but finished the week at USD908/mt on truck in Anzali including 6% VAT on Thursday. Sadness in Long products market and lower ex-rate made prices downward.
HRC thickness 3- 15 mm was downward till Wednesday which slab price of Khouzestan Steel mill increased at IME. Expectation of improvement in prices made market participants more active in buying HRC 15 mm thickness and higher.
Lower supply level of CRC with small sizes from Mobarake Steel mill made its price improve but just by USD8/mt. For thickness of more than 0.9mm, shortage of demand continued and prices were unchanged.
Nothing influenced HDG market during last week. Its price was unchanged with limited demand level.
(Ex-rate: In Exchange Room: Rials 24,770/USD)
Iran Steel Service Center