Billet
Billet market sentiment didn’t change during last week in Iran. Scrap price is stable, so billet won’t experience downward trend. Import market was quiet and low supply level made market almost stable. Minimum offer price of billet size 150 mm in Iran import market is USD500/mt cfr Northern Iranian ports. Maximum cost price would be Rials 15.5 million /mt. Currently, sale price is around Rials17 million/mt in domestic market. Therefore, despite this difference, import level has dropped as market participants are waiting for final result of nuclear talks between Iran and 5+1.
Market participants believe if nuclear agreement is signed, foreign currency supply level will increase and Rial will go up, so import will increase and prices will drop. But this may continue for just 2 days and prices will come back to last levels again.
This kind of forecasts in the market has declined production and market activity as everybody is holding wait and see policy. Besides, lack of demand is also affecting market.
Of course government support this situation for time being since it supports inflation rate to decrease.
Long products
Long products were downward slightly during last week in Iran. Debar price finally dropped by around Rials200,000/mt and other long products by around Rials400,000/mt. Limited supply level of some sizes of I-beam by domestic producer Esfahan Steel Co, made its price a little upward and the mill sold 60,000 tones of size 14 mm I-beam and 30,000 tones of size 18 mm at Iran Mercantile Exchange.
Generally, main sentiment in the market is wait and see policy. Besides, seasonal weakness of activities in The Holy Month of Ramadan won’t let prices change significantly. Any possible significant change in the steel market would be experienced by next month.
Flat Products
Hot rolled coil 2 mm thickness was downward by beginning of the week but experienced Rials500,000/mt increase in second half of the week to around Rials18.8 million/mt on truck in Anzali including 8% VAT and other costs. Demand level is low so prices will drop again in coming days. Some sizes of HRC especially 4 mm thickness are in supply shortage but quiet demand didn’t let prices improve. HRP market is also experiencing some limited supply but demand is low and prices are almost stable.
Lower ex-rate made price of Kazakhstan origin CRC decline , so domestic prices became stable. CRC supply level by Mobarakeh Steel co is so low but prices have peaked and buyers are not interested in dealing.
HDG market was like last weeks in low demand and prices dropped slightly. Increasing offers at Southern ports made market almost stable.
Ex-rate:
In Exchange Room: Rials 25,901/USD
In free market: Rials 31,160 /USD
Iran Steel Service Center