Billet
Billet market was stable during last week in Iran. Price of billet size 150 mm changed by just USD2/mt despite lack of demand and the fact that long products prices have bottomed. The stable trend was due to :
1- Almost stable exchange rate
2- Restricted import level
3- Prices at the bottom and no space for more declines
4- No significant downward trend in long products market
As new government has started working officially, market participants expect some changes in steel market trend in coming future.
Long products
Long products market was downward but very limited and prices have reached the bottom. Prices dropped by USD4-8/mt and in some cases were lower than cost price.
Big traders mostly have not bought any cargo from mills during last 2 months and inventory level is very limited. Some traders worried about more declines in prices in the future and in need of liquidity tried to sell inventories but buyers were dealing very cautiously regarding these cargoes.
Debar diameter14-25 mm was offered at USD766/mt on truck in Ahwaz including 6% VAT, but its cost price for traders was around USD764/mt. Which means traders cannot make profit more than 1%. It has been common trend of the market from 2 months ago, so investments has gone to Iran Mercantile Exchange. Buyers are not interested in steel market, and steel production has dropped too.
Besides, billet import level has dropped from around 137,000 tones during last month to more than 35,000 tones during first 21 days of current month. Billet supply level at IME has dropped from around 212,000 to 125,000 tones. Around 787,000 tones of billet have been transacted at IME from beginning of current Iranian year and import level has been around 356,000 tones I this period. It is clear that raw material supply level has dropped due to lower long products demand.
As market inventory level has declined, any positive change in demand will end in higher prices.
Flat products
HRC 2 mm thickness was transacted at USD795/mt on truck in Anzali including 6% VAT and custom duties then price started dropping to finish the week at USD770/mt.
Other sizes of HRC also experienced some declines but generally market was almost stable especially for Oxin steel mill's products.
HRC thickness 8-12 mm was offered at USD718/mt in Esfahan market, but sellers resist against downward trend. Traders have not been eager to replenish inventories during last 2 months, so market inventory level is low. Producers have not changed prices significantly.
CRC market was quiet due to summer stoppage at consumer sections which will continue till next 3 weeks. But CRC price has bottomed too.
HDG market is facing lack of demand and its price changed a little during last week in Iran.
(Ex-rate: In Exchange Room: Rials 24,794/USD)
Note: Prices have been converted from Rials to USD using exchange room rate as a base.
------------
Iran Steel Service Center