Billet
Billet market experienced some improvements
during last week in Iran. Billet size 150 mm was not offered at Anzali port,
just a transaction was done at Rials13.7 million/mt on truck in Anzali including
8% VAT by beginning of the week. Esfahan Steel Co offered billet size 150 mm at
base price of Rials13.4million/mt ex-works including VAT. Other domestic producers
offered the same size of billet at Rials13.5-13.8million/mt.
Billet size 125 mm was being offered at limited
tonnage around Rials13.25-13.3million/mt ex-works.
Esfahan Steel Co sold 5,000 mt of its billet at
IME at Rials13.4/mt, but it was just a matching deal. As sections production
level has declined, billet production level has also reduced. Many small mills
have closed due to lack of demand and big market leaders have decreased
production capacity.
Besides, we have just around two more working weeks
till end of current Iranian Year (end at 20 March). Therefore, market participants
are closing accounts and any improvement seems unlikely in billet market.
Long products
Some speculations by beginning of last week made
debar base price increase by Rials100,000/mt to Rials16million/mt including 8%
VAT. Esfahan Steel Co sold 5,000 mt of
its mix debar basket at IME on Monday. This trend continued on next days and
the mill sold around more 7,000 mt of its debar on Tuesday. Then market was
almost stopped by Tuesday afternoon and buyers preferred staying back. As
expected, this price improvement was just due to speculation and demand level
was quiet by end of the week.
Main problem of long products market is demand
level at the moment not the price trend. Many market leaders are in a difficult
situation and cannot afford their production costs. They need big amount of
investment to improve their situation, but yet they have many unpaid bank loans
too. Other active producers have also reduced their capacity.
Flat Products
HRC 2 mm thickness experienced some
improvements during last week in Iran despite all market expectations. It
increased from Rials16.6million/mt to Rials18.5million/mt on truck in Anzali
including 8% VAT. All market participants were surprised as couldn’t find any
reason behind this improvement. Import offers are around USD420/mt cfr Northern
Iranian ports and inventory level is high at ports. Though, HRC price started
dropping by Monday and reached Rials17.4million/mt by end of the week. Downward
trend is expected to continue in coming weeks.
HRC 2.5-4 mm thickness was also down by
Rials300,000/mt. Thickness 6-15 mm was stable in price as limited supply of
domestic leader Mobarakeh Steel Co justified enough inventory level of imported
cargoes at Northern and Southern ports. HRP market had an unchanged week as
lack of demand made low domestic supply an ineffective factor.
Some rumors about limited supply by Mobarakeh
Steel Co and possible rise of custom rates, made CRC market upward by beginning
of the week, but by Tuesday downward trend started and finished the week
Rials300,000/mt lower. HDG market also followed the up and down trend of CRC.
These markets will also be active just for next two working weeks. Import level
has reduced currently but it won’t help prices as CIS and Chinese origins are
declining and has not reached the bottom yet.
Ex-rate:
In Exchange Room : Rials27,670 /1USD
In free market : Rials34,100 /1USD
Iran steel service center