Billet
Iran billet market experienced a stable week and size 150 mm was priced at USD718 /mt on truck in Azanli including 6% VAT and custom duties. Billet was offered at USD698-702/mt including 6% VAT and custom duty at Imam Khomeini Port depending on the size. There was no demand in long products market but billet suppliers didn''t change prices.
Billet product of Khouzestan Steel Mill was transacted at IME( Iran Mercantile Market) on Wednesday at USD668 /mt, which would be USD709 /mt after 6% VAT and other costs. After this transaction, billet traders became sure that prices won''t fall in near future. Besides, import level has decreased significantly and around 11687 tones of billet have been imported during first 2 weeks of current Iranian month (23 Jul-05 Aug). Lower production level of long products has decreased billet production level. Supply level is downward, so prices won’t change significantly.
Long Products
Long products prices were up by USD8/mt by beginning of last week due to higher ex-rate, but were downward again as:
1- Market was not ready to accept any improvement in prices as warehouses were full and there was no demand in the market.
2- Debar was offered at USD764 /mt including 6% VAT in Ahwaz market when market average price is USD774 /mt. This offered cargo was limited but made market silent and prices started dropping by Tuesday. Billet price was stable but long products prices were downward till end of the week. Debar price in retail market was lower than prices at IME by end of the week.
Market participants mostly believe that prices have reached bottom and should improve in coming days. The gap between billet and debar from domestic producers has reached USD52/mt which means loss for long product producers. Though, production level would drop unless prices improve. Demand level is scarce as many buyers are waiting for significant decline in prices in coming future. But it should be noted that infrastructure projects spending has decreased and there is no hope in demand improvement too. At the moment general trend is wait and see policy which may last till September.
Flat products
Price of HRC 2 mm thickness was down by USD16/mt to USD766/mt on truck in Anzali including 6% VAT and custom duty during last week in Iran. Other flat products were downward too as demand level is scarce. Traders are not interested to buy flat products from Mobarakeh Steel mill as a market leader. The mill''s products prices have reached bottom and buying them would have no profit for traders.
Other producers like Oxin and Kavian Co are faced with lack of demand. Despite supply shortage for some sizes prices are downward. At the moment importing some sizes is profitable, so imported cargoes are competing with domestic products.
CRC market was downward and summer stoppages at consumer sections have influenced CRC demand significantly which will continue till September.
HDG market was also quiet like current weeks and there is no hope in improvement till next month, although its supply level has declined too.
(Ex-rate: In Exchange Room: Rials 24,792/USD)
Note: Prices have been converted from Rials to USD using exchange room rate as a base.
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Iran Steel Service Center