Billet
Billet market had a steady trend during
last week in Iran at around average of USD 597/mt ex-work including 9% VAT. Lack
of activity in rebar market and DRI price control at IME (Iran Mercantile
Exchange) were the reasons behind this stability. However, there are rumors about
lower supply of billet out of IME and possibility of its higher price. The main
reason for any decline in production would be recession of rebar market.
According to Metal Bulletin, average export
billet price dropped by USD 5 /mt to USD 560/mt FOB Iranian ports.
Long Products
Rebar price tended to increase by beginning of the week as market
inventory has decreased but market control and lower price at IME, made it downward.
Firstly, improved a little by USD 1/mt
to USD 679/mt and moved back again to USD 678/mt ex-work including VAT by end
of the week.
I-beam started the week well and was up from USD660/mt to USD
666/mt, but the announcement of new prices at IME stopped the market and price
returned to USD 661/mt.
Flat Products
Two
mm thickness HRC ex-work Mobarakeh was USD 1071 /mt on last Saturday, which
reached USD 1067/mt by Tuesday. Mobarakeh Steel co HRC had a stable trend generally.
Besides, extremely low consumption and low profit margins have made market
quiet, and rumors of higher supply level will make demand more backward.
Oxin
co HRP has remained at the bottom. Despite sharp decline of slab and HRC in global
markets, the mill is committed to the offered prices of a few months ago, so buyers
profit margin is minimized and not willing to buy from the mill. Market price
changed from USD 1117/mt to USD 1123/mt ex-work including VAT. Kavian Co continued
to keep its HRP price stable at USD 1054/mt.
Limited
supply level made CRC price increase from USD 1256/mt to USD 1271/mt.
HDG had a steady trend at USD 1308/mt due to stability of
HRC price and sluggish demand.
Weekly Analysis:
In world
market, oil and gas prices are not skyrocketing any more. Commodities have a
hot market just in the USA, driven by inflationary concerns. Price of billet
and slab is declining due to weak demand. Christmas and New Year Holidays are
approaching in the world market, followed by the Chinese New Year Holidays. In
general, global market is stable and calm due to the holidays and concerns
about China's economic growth. While prices have reached their bottom.
But
in the domestic market, government interventions through IME has exhausted market
players and signs of decline in production has appeared, which is due to controlling
prices by authorities on the one hand and lack of demand on the other hand.
In this situation, the worst thing is about currency rate,
which if decreases, market will go into a recession. Usually by end of each quarter,
exchange rate rises and falls. So we have to wait and see the end of this
season, which has two serious scenarios with itself too. The first one would be
a sharply contractionary government budget and the second one is Nuclear Negotiations.
CBI weekly average ex-rate for Steel Products (SANA): Rials 237,171
USD
13 Dec 2021
Iran Steel News Bulletin
IFNAA.IR
IRSTEEL.COM