Billet
Billet price was upward
during last week in Iran domestic market. Billet size 150 mm started the week
at Rials12.9 million/mt ex-works including 9% VAT. By Monday prices were upward
and reached Rials13.8 million/mt till Wednesday, then it was downward again to Rials13.3-13.5
million/mt. some market participants were talking about Rials13.1 million/mt
ex-works including 9% VAT. Billet size 125 mm was Rials11.5-11.7 million/mt on
Saturday and reached Rials12.5 million/mt ex-works including 9% VAT. Market
trend was not clear and size 150 mm from some private mills was not lower than
Rials13.7 million/mt.
There is no logical
reason behind the upward trend and speculative activity of some mills and
market participants made it happen. Everybody knows that demand is low and has
no strength. Besides, global prices are downward. This may lead to lower export
level for Iranian billet. When export decline, domestic supply will rise.
Imported billet size
150 mm from CIS origin was USD350/mt cfr Anzali port and Chinese one USD310/mt
cfr Imam Khomeini Port. But custom duties are high and imported cargoes are not
competitive against domestic billet.
Long Products
Long products were upward during first
half of last week and became calm for the rest of the week. Esfahan Steel co
debar diameter 14-25 mm started the week at Rials15 million/mt ex-work
including VAT and finished it at Rials15.53 million/mt. Average price of I-beam size 14-18 mm also
increased from Rials15.5million/mt to Rials15.95 million/mt ex-work including
9% VAT. Other long products experienced the same trend, they were upward from Saturday
till Tuesday, but became quiet by Wednesday
and experienced some declines.
There are two different views in Iran Long
products market :
First view believes, main policy of
government during current Iranian year would be controlling inflation rate.
Therefore price fluctuations won’t be higher than Rials1million/mt which means
less than 10% of sale price. Demand is scarce and market will be depressed till
end of the year.
The other view believes as government
budget has been announced currently, state authorities are forced to make
market improve even if with just around 10% rise in prices.
It should also be noted that Holly month
of Ramadan is coming (begin at 07th June) and market activity will
almost stop. Therefore government will make use of this condition to decline
inflation rate significantly. Though, price fluctuations may occur but any real
change in market trend would happen after Ramadan.
Flat Products
Imported HRC 2 mm thickness started last
week at Rials17.9 million/mt on truck in Anzali port including 9% VAT and
custom duties and Rials17.7 million/mt on truck in Imam Khomeini port. It
finished the week at Rials18 million/mt in Anzali and was unchanged at Imam
Khomeini port.
Import offer of HRC 2 mm thickness is
USD390-410/mt cfr Northern ports. Its cost price for importers would be around
Rials18 million/mt and due to market sadness there is no interest in import.
During last Iranian month (20th Apr-20 May) more than 80,000 mt of
this material has been imported to Iran which is 10,000 mt higher than average
monthly import level during last year. Import level is expected to decline in
current month as global prices are downward.
HRC thickness 2.5-10 mm was unchanged due
to lack of demand. Consumers avoid building inventory as they have liquidity
problems. For the thickness 10-15 mm,
prices were also stable despite around Rials200,000/mt discounts offered by
some importers. HRP thickness more than 15 mm was downward and Oxin co product was
Rials15.5 million/mt ex-work including VAT. The mill is resisting against
downward trend but some traders in need of liquidity were ready to give discount.
CRC market experienced a downward week. Imported CRC price at Imam
Khomeini port dropped from Rials22.5million/mt on truck including VAT and
custom duty to Rials21 million. The same trend was experienced in Anzali port
too. Consumption level is downward, but around 55,798 tone of CRC has been
imported during last Iranian month and around 115,000 mt was sold at Iran
Mercantile Exchange.
Based on supply level and lack of demand, downward trend will
continue in CRC market. Besides import offer has dropped from USD520/mt cfr
Anzali port a month ago to USD430/mt cfr Anzali currently.
HDG market was also downward and market sentiment won’t change
significantly in near future.
Ex-rate:
Official rate:
Rials30,465/1USD
In open market: Rials 34,800 /1USD