Billets
Billet prices last week was bullish trend, in fact primarily leap to climb. Steel mills due to
the recession and holidays in Iran and prosperity of the global market in the
first quarter of 2016 began to export their products, the
result was a limited supply of Billet. With a limited supply of scrap,
billet production also came down and as a result small mills increased their
prices. As much as 8 percent increase in sections price levels during the two
weeks leading up to the background of rising billet prices.
Khuzestan Steel Complex sold 10.000 tons billet in the competitive environment
in Metal Exchange Market at 12.345.000 Rials per ton (excluding VAT)
base price. It was heard that the
deal was a window that is defined out of stock. Prior to this transaction this price was 12.000.000 to 12.200.000 Rials per
ton including 9%VAT in the market. This transaction in the stock, excited
market extremely and left final Billet price even at 13.600.000 to 14.000.000
Rials per ton at the end of the week, but on Wednesday noon market was quiet. Traders
offered their inventories at 13.200.000 Rials per ton for Arfa Billet and
13.240.000 Rials per ton for Neishabour product Billet. It comfort the market, though it is unclear due to
confusion still remained on billet prices.
Most of sections manufacturers are facing a shortage of billet and the market is waiting to buy their products. In this
situation, billets can be whatever he wants to play and let
us not forget that the export market is also active. DRI and billet
mills have sold their products to a month and do not dare to sale for the coming
months because raw material prices will go up, while the supply of pellets to
the circumstances, however, may not be synchronized with the current demand. In
any case, Iran domestic market have been particularly affected by the export of
raw materials specially billet for the first time. By following this process,
in the event of a drop in demand in export market, slowdown in the domestic
market is inevitable because the government does not have any concrete plans to
support exports and if it would disrupt export market, these
products will flooded the domestic market while the demand is very low. On the other hand, scrap that is used in small
mills is scarce and its price reached 9.500.000 Rials per ton, and its import
price of USD170.- per ton CFR Amirabad reached to USD220.- per ton.
So Iran
steel market is experiencing new frontiers supply and prices while demand is
steady and price increase in due to shortage of supply as China is not in the
market and prices are close to early 2015. The sharp fall in prices would be if this situation did not
last.
Long Products
At the beginning of last week, rebar prices decreased, this process
continued until Monday but on Monday prices began to rise till Wednesday at
once rebar offered price hit 16.000.000 Rials per ton. However, later that
afternoon again fell as much as 150.000 Rials per ton and on Thursday the
market was quiet because the price was not clear. The same process happened for
beams, with the beams of the first week was to increase. Naturally, the prices
went up and the sellers refused offering.
Angles and Channels price trend was such as rebar, the only difference is
that their supply is severely restricted because they are dependent on the
billet size 125 mm and supply of this size either dropped.
As long as billets are exported and export ground exist, section market will be
turbulent. However,
the domestic market demand is still not arrived. With the closure of the 1395
budget, requests will be enabled and it must be observed
sections market.
We will see what this week is fixed section prices
because of high inventories and traders prefer to sell stocks with good earnings.
Flat Products
At the beginning of last week, HRC price thickness of 2mm was 16.300.000
Rials per ton including VAT in Anzali port but prices have soared on Monday and
reached to 18.000.000 Rials per kilo even on Thursday was heard 19.000.000 Rials
per ton. This is due to lack of supply from the foreign seller, their offered
prices for end of February, March and April shipment at $290 per ton CFR Anzali
increased to $430 per ton and still refuse to sale. Probably will start selling
at $450 to $460 per ton, these are for CIS products. Chinese are not in the
market and they are reluctant to supply. Russia hesitate to offer HRC and China
generally offer product to its own domestic market. For this reason, Chinese
and Russian flat products faced rising prices in ports and sometimes faced stop on the sale.
Till Tuesday, Chinese plate thickness of 10mm to 15mm was offered at 16.500.000
to 16.700.00 Rials per ton including VAT and it was 15.300.000 Rials per ton
for more than 20mm thickness. Rising in billet price will result slab price
increase. Thriving slab export bewildered Oxin Mill flat products prices at the
end of the week. While there was talking for prices at 16.000.000 Rials per ton
for HRP thickness 10mm to 15mm and 15.000.000 Rials per ton for above 20mm
thickness, most of sellers refused to sell to expect price stability. But real
consumers are not in the market yet. On the other hand, the large volume of
sheets purchased last year by wholesalers and warehouses have enough
inventories and this does not allow
prices to fluctuate wildly.
Cold rolled began this week with tension.
Russians announced price of $500.- per ton CFR Anzali for CR 0.70mm with so
limited quantity and Chinese offer the same material at above $540.- per ton
CFR. Goods in Iranian customs have
been purchased at a price $320 to $340 per ton CFR. The price difference is not
compensable for the importer and they are all confused. Buying inventory is now subject to purchase
substitute goods. Continuing this process, will resulted shortage of
inventories for CR products.
Mobarake Steel Complex is exporting its products. In fact, imported
material prices are in line or even higher than Mobarake prices and this trend
will be continued as long as foreign market have the power to absorb Mobarake
products.
Hot Dip Galvanized market was also rising and prices increased up to 800.000
Rials per ton through last week.
Ex-rate:
In official
rate: 30,289 Rials /1USD
In open market: 34,740 Rials /1USD