Billet
Billet price experienced some fluctuations during last week in Iran. As market had started working after Ramadan, long products market participants were expecting higher prices due to low market inventory. Lower supply level of billet at Anzali port in northern part of Iran also helped domestic producers. Therefore, domestic billet size 120 mm increased from Rials16.2-16.7million/mt to Rials16.7 million /mt including 8% VAT. But market was stopped by end of the week.
Khouzestan Steel Co sold 70,000 tones of its billet at IME at base price of Rials15.5 million /mt ( excluding VAT) by last week and announced by Wednesday that will offer its billet at Rials15.02/mt on August 9th which means around Rials 500,000 mt decrease in price. This policy made retail market stopped.
Iranian buyers have purchased significant tonnages of CIS billet during last Iranian month (22Jun-22 Jul). Around 10,000 tones of these cargoes will arrive in coming days. Price of CIS origin billet has increased by USD10/mt to USD520/mt cfr Northern Iranian ports. If Iranian importer opens Letter of Credit with 35% prepayment for buying these cargoes, would get a good profit so there is potential interest in importing billet.
As price of scrap and DRI has not declined in Iran, domestic billet price won’t be lower than Rials16million/mt including VAT in near future.
Long products
Low market inventory and expectation of improvements after holy month of Ramadan, made long products upward by beginning of last week. Debar price improved by around Rials300,000/mt till Tuesday and reached rials18.3/mt for diameter14-25 mm exworks, including 8% VAT. But market could not absorb these increases, so was stopped by middle of the week and get back to last prices by Thursday.
Main reason behind this backward trend in prices was lack of liquidity. As there is no hope in better demand in near future, improvement in steel market investments is unlikely. Though, lack of liquidity will stay in the market.
I-beam market was in a good condition. I-beam market is being controlled by one leader producer, so prices were upward slowly. If the situation continues, imported products would be competitive as around 6800 mt of I-beam was imported during last Iranian year which shows a significant rise compared to previous months.
Price of angle and channel was fluctuating like debar. Demand is low and higher prices were just due to increase in productions costs not real demand.
Flat products
HRC 2 mm thickness experienced some rises due to low supply level. Its prices increased from lower than Rials 20 million/mt to Rials21.5 million/mt on truck in Anzali including 8% VAT by Monday. But it started dropping again to Rials20.4/mt by end of the week. More than 20,000 mt of HRC was available at Northern ports but Eid –al- Fitr Holidays had made custom affairs and shipments almost stopped. As market available stocks increased by Tuesday, prices were downward.
During previous months high level f HRC has been ordered in import market and price increased by USD40/mt, so experiencing downward trend in coming months won’t be unusual. Afterward, market will be more stable. At the moment HRC 2 mm thickness is USD570/mt cfr Northern ports. Final price after custom duties and 8% VAT would be Rials18million/mt.
HRC 2.5-6 mm thickness is experiencing low supply level especially for size 4 mm at the moment, but lack of demand didn’t let prices change significantly. It’s expected that around 35,000 mt of these products which have been imported last year increase market inventory in coming weeks.
HRP thickness 10-15 mm is also in supply shortage mainly for size 12mm which has increased in price a lot. But higher supply level of domestic producers has declined market pressure.
Price of HRP thickness higher than 15 mm didn’t improved despite higher demand as market is not ready to accept any increase in prices.
CRC market was also in low supply especially for sizes lower than 0.50 mm which is in need of import. But at current price, importers are not interested to work. For thickness lower than 0.50 mm , domestic producer Mobarakeh Steel Co has declined supply level. Its priced increased by Rials300,000/mt during last week. But market is almost stopped and significant change in prices is unlikely.
In HDG market, prices were up by Rials100,000-300,000/mt due to low supply level , market was quiet by end of the week.
Ex-rate:
In Exchange Room: Rials 26,412/USD
In free market: Rials 31,400 /USD
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Iran Steel Service Center