Billet
As government’s controlling policy continued during last week in Iran, billet
price, which was USD 373 /mt on last Saturday, reached USD 355/mt ex-work
including 9% VAT by end of the week. The main reason for this
downward trend was government policy, market confusion and expectations, and
more importantly, depreciation of exchange rate.
Meanwhile, billet price reached USD 480/mt CFR Chinese ports due to
seasonal demand. This is a good opportunity for Iranian exporters to increase billet
export level due to lack of domestic demand. Besides, base price of DRI has
reached below USD 226/mt and its demand is limited because billet production level
has decreased.
The most important factor behind lower billet price is shortage of demand
in long products market, which does not seem to return easily.
Long
Products
Long products prices
were declining following downward trend of previous three weeks. Average rebar price
on last Saturday was USD 432 /mt and reached USD 409/mt by end of the week. Long
products offered on IME had no demand on Wednesday, but on Wednesday afternoon,
some traders decided to buy, which it prevented prices from falling. This is
while the volume of billet produced and stocked in mills’ warehouses is high.
If this condition continues, price trend will not be upward. Market participants
at the moment prefer waiting policy, but this will end in lower market
inventory.
Flat
Products
HRC 2 mm thickness was down from USD 734 /mt ex-work Esfahan to USD 643/mt
by end of the week. Mobarakeh Steel co HRC thickness 3 -15 mm also had a
downward trend from USD 602/mt to USD 573/mt ex-work including 9% VAT. Market insiders
believe that HRC price is near the bottom and downward trend would stop at
least by end of current Iranian month ( mid-December), especially as export
market sentiment is improving.
Oxin co HRP, which was USD 613 /mt on last Saturday, reached USD 603/mt
ex-work including VAT by Wednesday. It is heard that Oxin co has exported
30,000 tons of its products, however, flat products market trend has also
affected Oxin co HRP. Kavian co HRP, also declined from USD 565 /mt to USD 554 /mt
by end of the week.
CRC market had a downward trend due to market closures and falling
ex-rate, from USD 1031 /mt to USD 976/mt ex-work including VAT.
HDG price also fell from USD 253250 /mt to USD 231938 /mt, which was
due to lower HRC price.
CBI
weekly average ex-rate for Steel Products (SANA): Rials 256,728 USD
30 Nov
2020