Billet
Billet market experienced a stable week in Iran. Size 150 mm was around USD598 -603 /mt on truck in Anzali including 6% VAT and custom duty but at limited tonnage. Size 120 mm was offered at USD595 /mt on truck in Anzali including VAT and custom duty.
Domestic billet size 120 mm was around USD 562- 574/mt ex-work including VAT at the beginning of the week. Around 100,000 tones of Khouzestan Steel billet production was purchased at USD554 /mt ex-work excluding VAT with delayed payment terms. This transaction made market participants hopeful that prices have reached the bottom.
Domestic mills sale level was almost high during last week, so producers resist against any decline in prices. But billet price may drop in coming weeks as demand level will decline after current purchases. Khouzestan Steel billet was offered at USD586 /mt ex-work including VAT by end of the week at cash payment. Though, a trader which have bought billet at USD554 /mt ex-work excluding VAT with delay payment, it would be affordable for him to sell it at USD588 /mt in cash payment including VAT.
Long products
Long products were downward by beginning of last week in Iran. Debar price reached USD643 /mt ex-work including 6% VAT due to minimum demand. Other long products were in the same situation. Market participants believe that long products prices will stay at around current price till year end ( 20 March), if billet prices does not decline.
But there are two other factors affecting long products market including liquidity shortage of mills in last quarter of the year in Iran and high possibility of energy subsidy omission in next year which will affect steel cost price.
Obviously energy subsidy omission and 100% increase of gas price, will rise cost price of steel products. But market participants doubt buyers will accept such rises in prices due to current depression of the market.
Based on current billet price, long products prices have bottomed but any decline in billet price would affect this market too. Besides, steel mills in need of liquidity may give high discounts till year end to customers. Though, any hope of improvement in prices in first quarter of next year ( begin at 21 March) won’t be logical.
Flat products
Flat products market was almost quiet during last week in Iran. Price of 2 mm thickness HRC increased to USD 751/mt on truck in Anzali including 6% VAT but declined by USD20 /mt till end of the week. HRC 2.5-15 mm thickness from Mobaraleh Steel Co declined by USD4 /mt. Lack of demand was the reason behind price declines like previous weeks. But it should be also noted that prices have bottomed.
HRP 20 mm thickness from Oxin Steel Co declined to USD579 /mt ex-work including 6% VAT which is the lowest level experienced this year. As demand is limited and Kavian Steel Co product at USD667 /mt ex-work including 6% VAT is competitive, downward prices will continue.
CRC market was in low inventory like previous weeks but prices didn't improve significantly. Some sizes experienced rise of USD8 /mt with no transaction done.
HDG market was also in a quiet sentiment, lack of demand and low availability made market almost stopped.
(Ex-rate: In Exchange Room: Rials 24,892/USD)
Note: Prices have been converted from Rials to USD using exchange room rate as a base.
Iran Steel Service Center