Billet
Billet market had a
decreasing trend during last week in Iran , despite higher prices at IME, due
to the stagnation of long products market and market mentality towards reducing
prices. Its price dropped by USD 5 /mt to USD 692 /mt ex-work including 9% VAT
by end of the week.
Long
Products
Rebar price increased from USD 754 /mt to
USD 762 /mt due to rising prices at IME, but price increase made market quiet.
Domestic market can’t afford more expensive rebar and is waiting for the result
of Presidential Election and talks In Vienna. I-beam price was also upward
following higher prices at IME.
Flat
Products
Mobarakeh Steel co HRC 2 mm thickness was USD 1150/mt on last Monday, which
reached USD 1155/mt by Wednesday. Price of 3 to 15 mm thickness HRC slightly
improved on Wednesday, which was affected by the way Mobarakeh Steel co was offering
to the market.
Oxin co HRP was almost stable at around USD1342/mt as the market can’t
accept higher prices. Kavian co HRP also stayed unchanged at USD 1155/mt as the
mill is controlling prices.
CRC had a stable market and did not change significantly. It finished the
week at USD 1390 /mt Lack of demand in summer season is usual for CRC market.
HDG had price stability due to the balance between supply and demand. It was
around USD 1432/mt.
Weekly Analysis:
The steel market
outside Iran has reached its peak in terms of price and the range of price
fluctuations is in the plus or minus $30 range, besides, demand level will decrease
due to rainy season. In Iran market, as presidential election is near, no
construction projects are active, as a result, consumption has reached bottom.
Iran domestic prices have exceeded global prices. Some expect that
with higher raw material prices in Iran as well as scrap price increase in global
markets, our export market trend will be like previous three months. Power
outages and lower production level also confirm this scenario. But it should
not be forgotten that lower production level will reduce raw materials demand.
In recent weeks, DRI supply level has increased and its price has declined
slightly too.
The remaining and
final factor that is very important is the talks in Vienna about Joint Comprehensive Plan of Action, which will
strongly affect exchange rate. Besides, United States has removed some Iranian
authorities from its sanctions list. On the other hand, US government needs
cheap oil to reduce inflation level, which would be a chance for Iran to
increase its oil export. As a result of which, the possibility of a fall in ex-rate
due to higher oil exports would be serious. This scenario also has made Iran steel
traders extremely conservative.
CBI
weekly average ex-rate for Steel Products (SANA): Rials 202,596 USD
14 Jun
2021