Billet
Billet market
was downward during last week in Iran. Domestic billet size 150 mm decreased
from Rials13.5-13.6 million/mt to Rials13.2 million/mt ex-work including 9%
VAT. Billet size 125 mm also dropped from Rials13.4 million/mt to Rials13
million/mt ex-work including 9% VAT. Khouzestan Steel co offered 80,000 mt of
its billet size 150 at IME ( Iran Mercantile Exchange) on Wednesday at base
price of Rials12.5 million/mt excluding VAT but sold just 24,000 mt of it. Khouzestan
steel co billet was not being offered in retail market during last month in
Iran. This time 2 days before offering at IME, it was available at Rials13.2
million/mt ex-work including VAT in retail market. Khorasan Steel co billet was
also available at Rials13.2 million/mt ex-work including VAT.
It seems that
billet base price at IME won’t be lower than Rials12 million/mt. If it decline
more, will affect DRI, iron ore and pellet price too. If
government let prices decline, buyers will go back and market situation will
became worse. Raw material producers would be faced with many problems then.
Long products
Long products
were stable during last week in Iran. Average price of debar diameter 14-25 mm
in Esfahan was stable at Rials15.42 million/mt including 9% VAT. Some sellers
tried increasing prices but were not successful as market fundamentals were
week.
I-beam size
14-18 mm changed from Rials15.217million/mt to Rials15.1 million/mt ex-work
including VAT in Esfahan. Angle and channel were also unchanged.
Reasons behind
long products stable market include lower production rate and stable billet
market.
Real demand has bottomed but supply level has
reduced too. Mills are stocking raw materials at their warehouses for just a
week. Therefore will use lower money and would lose less if prices drop.
Besides, billet market is almost stable and long producers are confident that
raw material is available any time they need. This is a logical policy
especially when global prices are downward too.
Flat Products
HRC 2 mm
thickness improved during last week in Iran due to low supply level. It was
Rials17.5 million/mt on truck in Anzali and Rials17 million at Imam Khomeini
port by Saturday, then finished the week respectively at Rials18 million /mt
and Rials17.4million/mt on truck including 9% VAT and custom duties. During
first quarter in Iran, HRC 2 mm thickness import level has been 104,000 mt,
71,000 mt and 45,000 mt respectively. Minimum purchase price from CIS has been
USD350/mt cfr northern ports. Therefore minimum finished price at Anzali port
would be Rials16.6 million/mt including VAT and custom duty.
Import level
has declined significantly, though, lower supply level and rising prices has
been something expected.
HRC 2.5-8 mm thickness
was unchanged. Size 8-15 mm dropped by Rials100,000/mt due to market sadness.
HRP market was
faced with limited supply level of Oxin and Kavian co like previous weeks.
In CRC market
limited availability helped improved prices. Import level has been low as
during first quarter it was 35,000 mt, 55,000 mt and 16,000 mt. Besides, global
prices are downward therefore any improvement in Iran market won’t be
permanent.
HDG market was
calm and prices stayed almost unchanged during last week in Iran.
Ex-rate:
Official rate: Rials30,640/1USD
In open market: Rials 34,690 /1USD
25 June 2016