Billet
Billet market was
upward during last week in Iran. Domestic billet size 150 mm improved from USD361/mt
to USD380-385/mt ex-work excluding 9%VAT. Billet size 125 mm also increased by
USD22-24/mt to USD377-380/mt ex-work excluding 9%VAT.
Two main events
influenced Iran billet market last week. Steel scrap price increased by USD41/mt
to USD273mt by middle of the week, but mills resisted against the improvement
and this made prices drop by USD 0.55-1/mt till end of the week. Khouzestan
Steel Co increased its billet price at IME after a while. By Tuesday the mill
offered 23,700 mt of its slab at IME at base price of USD380/mt ex-work
excluding VAT. By Wednesday, Esfahan Steel Co offered 10,000 mt billet at USD355/mt
ex-work excluding VAT, finally it was sold at base price of USD362/mt due to
the competitive situation.
AT the moment there
is no logical reason in Iran domestic market for upward trend of billet price.
But Steel producers’ association believes Iran domestic market should follow
upward trend in global markets. At the moment CIS billet is minimum USD390/mt
fob, its cost price for Iranian importers would be USD396/mt excluding custom
duty. Therefore, these efforts for increasing domestic prices would be a loss
for small mills which use scrap for steel products.
By last Wednesday,
when long products market became quiet, billet market balanced too. Scrap price
changed from USD232/mt to USD260/mt, then buyers left market and prices became
stable. This happened for billet market too. Some private mills 150 mm billet
increased by USD19/mt to USD377/mt ex-work including VAT, then market became
quiet on Wednesday waiting for this week deals making market trend clear.
Long Products
Iran debar market was faced with stockpiling during last week from
the mills. On Saturday debar price increased by USD3/mt and mills stopped
selling by the afternoon. By Sunday prices improved by USD14/mt. I-beam and
angle experienced the same trend.
By Monday some traders were offering debar at USD437/mt ex-work
including VAT, it was cargoes they purchased on Saturday. Therefore market
became confused and unstable. But mills’ policy for rising prices especially
for I-beam made small sellers also stop offering.
By middle of the week, lack of demand made I-beam price drop by USD3/mt.
Angle and channel also declined by USD3-8/mt. Debar market was depressed but
prices stable.
The problem is that demand has not changed and just mills’ policy
has changed prices.
In coming days some traders will start offering their cheap
purchased debars at retail market ( USD2-5/mt cheaper than mills current
offers), this won’t let debar and billet price upward trend continue.
Market will be quiet till
cheap inventories finish.
Flat Products
HRC 2 mm thickness started week 45th at USD560/mt,
reached USD593/mt by Tuesday and then started declining due to lack of demand
and finished the week at USD580/mt on truck in Anzali including 9% VAT and
custom duty.
The upward trend had two reasons:
1- Import offers increased as CIS origin reached more than
USD510/mt cfr Anzali port.
2- Exchange rate which changed from Rials36,000/1 USD to Rials36,300/1USD
and more.
HRC import level has been more than 160,000 mt during last 2 months
in Iran. At the moment CIS producers have increased prices and also decreased
supply level. A year ago they didn’t
accept inquiries of 2,000 or 3,000 mt, but now accept small deals for
increasing prices gradually.
HRC 2.5-6 mm thickness was still in supply shortage by domestic
leader Mobarakeh Steel Co. The mill limited supply level made price of
thickness 2.5-15 mm rise significantly. Upward trend continued during the week
as prices reached near import prices. Current upward trend in HRP market has
made end users worried and they have stopped offering their products too.
CRC market surged upward significantly during last week in Iran.
CIS seller were also offering scarcely at USD540-550/mt cfr Anzali . Market was
confused as some offer prices were around USD27/mt different from others.
Demand is expected to decline as importing CRC at USD656/mt on truck in Anzali
including VAT and custom duty is not acceptable for importers.
HDG market followed CRC market trend with some sizes not available
at all.
Ex-rate:
In open market: Rials 36.580 /1USD
12 Nov 2016
------------
Mona Taban
Iran Steel Service Center
IFNAA News Agency
http://www.ifnaa.ir/en/home