Billet
Despite falling
prices in global markets and weak demand, Iranian billet producers raised
prices at IME ( Iran Mercantile Exchange), and less than half of the offered
level was sold. High supply policy combined with high prices means that billet
producers are reluctant to sell their products in domestic market and count on export
market activity. If export market stops, small producers who are facing with
higher scrap and DRI price and also power outages in summer time, will be out
of market. If iron ore prices rise in the world market and billet export market
stays active, the trend of rising billet prices at IME will continue so that
small producers can be hopeful for their survival.
Long
Products
Following higher billet price, base price
of rebar also increased at IME. In spot market it was up from USD 746/mt to USD
748/mt ex-work including VAT. Billet and rebar price gap has reached 7%, which is
not affordable foe re-rollers. Therefore, meetings were held between re-rollers
and billet producers last week. Rebar producers are looking for lower billet
price and expectation of billet producers is to stabilize the market. Due to
higher rebar price and the presidential election, long products market experience
a quiet week.
Higher ex-rate from Monday onward made
I-beam price improve a little from USD754/mt to USD 761/mt ex-work including 9%
VAT.
Flat
Products
HRC 2 mm thickness was around USD 1134/mt until Wednesday. Despite higher
currency rate, market recession made HRC average price downward from Monday onward.
Oxin co HRP declined from USD1307/mt
to USD 1286/mt ex-work including VAT by end of the week. The market does not
have the power to absorb previous price rises and is waiting for lower prices.
CRC market was faced with a drop in price, but this decline was not so
noticeable. It ended the week at USD1366/mt. HDG market experienced some
fluctuations and finished the week at USD 1408/mt ex-work including VAT.
Weekly Analysis:
Price trend in Iran
steel market is influenced by the extreme caution of buyers at the moment. On one
hand, hopes for signing of the Nuclear Deal and on the other hand, the
presidential election has made it very difficult for market participants to
make decisions. At the same time, rising prices have concerned market
participants more, resulting in a severe market recession. History has shown
that when an economy reaches this point, it will change dramatically. We have
to wait to see the result, but the prospect for the next one or two months
until the new president takes office is not clear, and all hopes are on his
plans.
CBI
weekly average ex-rate for Steel Products (SANA): Rials 206,420 USD
21 Jun
2021