Billet
Last week, billet price in Iran dropped sharply. At the beginning of the week, billet size 150 was offered at IRR6.700/Kilo ($677/mt) including custom duty and 3% VAT, but no transaction was done at this level. As long product producers are suffering a lot from low demand and high costs, nobody is interested in buying billet.
In the middle of the week, billet price hit the bottom. There was offers at IRR 6.250/k ($632/mt) including custom duty and 3% VAT. Some transactions were finished at IRR 6300-6.400/ k ($637-647/mt) including custom duty and 3% VAT but in small tonnages.
As billet price is decreasing each day, buyers try to order just for immediate needs. Selling prices have dropped sharply. A parcel of billet size 150 of CIS origin was offered at $620/mt cfr Anzali, immediate delivery including custom duty and Vat. On Thursday, offer price of all sizes of billet was prevailing around EUR 490/mt ($630) but final transaction price could be $20 less than these levels. As debar price in Iran is not increasing, billet price should be under $600/mt cfr north Iranian ports to be cost effective for debar producers to pay for it.
Since billet lots are being offered at cheap prices, debar price has collapsed and there is huge inventories of billet in ports, it''s expected that billet price will drop to IRR 6.000/k ($606/mt) or less, the level of 3 month ago.
Long Products
Last week long products market was so silent in Iran. Isfahan Steel''s offer prices were down compared with a week ago, but demand was too low.
Many traders are trying to sell the stocks which they bought under IRR 7.000/K( $708/mt) including custom duty and 3% VAT, so in short run price increase is not expected.
As global price of billet and sections is decreasing, Iranian traders are trying to sell their inventories at any price to find liquidity. But global prices are high and not cost effective for importers yet.
Debar price decreased day by day last week. IPE, equal angle and UNP had a down ward trend too. On Saturday debar and size 140 – 180 mm IPE, were being transacted at IRR 7.450/k ($753/mt) in Isfahan including custom duty and 3% VAT. They reached IRR 7.200/k ($728/mt) at the end of the week. Right now there is no positive sentiment about future of the market.
Flat Products
2.00 mm HRC price dropped sharply last week. At the beginning of the week it was IRR 6.550/k ($662/t) fot Anzali port, including custom duty and 3% VAT but no transaction was done. In the middle of the week it reached IRR 6.150/k ($622/mt) fot Anzali port. At the moment HRC supply is higher than demand; transactions are just for immediate needs. Some traders are offering hot rolled coil at $630/mt cfr Anzali, prompt delivery but offer price for June/July shipment is EUR 530/mt ($704).
Low price stocks of HRC have not swallowed. If we omit 9.5 % custom duty and VAT from finished price of IRR 6.150/k ($622/mt) it would be $555/mt cfr Anzali port. This price is the same as last October''s price. Market participants do not expect prices to reach last year''s. If flat products market gets rid of speculations, prices would be more logical. When cheap inventories finish after 2 months, market situation will improve.
For higher sizes (more than 2.00 mm) HRC, Mobarake Steel''s offer price was down so market price decreased. Mobarake based 6-12.00 mm HRC was IRR 6.500/k ($657/mt) including custom duty and 3% VAT in Isfahan market. But no deal was done. Mobarake supply is too much.
15.00- 40.00 mm flats had a very stagnant market last week. Their prices dropped about IRR 150/k ($16/mt). In CRC market, as inventory was limited price volatility was a little but the market was too silent, thus just some sizes were offered .CRC price decreased around IRR 100-200/k ($10 -20/mt) last week. HDG and PPRG price didn''t change but no transaction was done in these markets. Small tonnages of CRC was being offered at $830/t cfr Anzali , HDG at EUR 730 ( $969) and PPRG at EUR 780/mt ( $1036) cfr Imam khomeini Port . Generally flat products demand in Iran was so low last week.
Iran Steel Service Centre