Billet
Higher price of long products especially rebar ended in an increase of $40/mt for billet price during last week, comparing with a week ago in Iran.
Average price of rebar was up by $40/mt and prevailing around $740/mt FOT Iranian northern port including 3% VAT. If we deduct $100/mt for converting charge of rebar, theoretically we can say producing rebar is profitable for rerollers.
As import level of billet has decreased significantly during last 3 months, if speculators do not change the market sentiment, billet market would remain strong in Iran.
At the moment many billet suppliers have stopped offering. It’s notable that during this week market activity would dump because of religious holiday, and Ramadan coming will influence the demand too. Although imported parcels with prices lower than $500/t are coming to Iran.
All these factors would influence Iran billet market in near future.
Long products
Last week long products prices reached the pick of last four months. The reason is that in last 2 months sections prices were down ward and reached the bottom with no demand in the market, but since a month ago, these products demand especially rebar increased because of governmental housing projects.
Short delivery terms of Isfahan Steel and low supply of private owned mills have supported the upward trend of long products too.
On Wednesday, average rebar price was $745/mt including 3% VAT in Iran market and IPE higher than $700/mt including 3% VAT in Isfahan market.
Market participants mostly believe that this trend is not sustainable and would change during this week. By the month of Rmadan, prices would fall as demand will decrease.
Flat products
Last week, 2.00 mm hot rolled coil was up by $30/mt to $620/mt FOT Iranian northern port including 3% VAT, comparing to a week ago. Limited import level and very low stocks are main factors of this upward trend. But pipe and profile producers have not started strong buying yet and only by higher demand of the sector, HRC price would improve in real sense.
Latest offer price of the material was $570/mt CFR Iranian northern port at Caspian Sea and import is not cost effective yet for Iranian traders.
CRC is in shortage of supply especially for 0.60 – 0.90 mm thick. CIS producers have stopped offering from 10 days ago and this situation would continue till first days of August.
Hot rolled plate was up around $20/mt comparing with a week ago and HDG around $10-20/mt.
Mobarake Steel mill didn’t change its prices at Iran Mercantile Exchange last week except for HRC which rose around $7/mt. It’s not cost effective to buy the material from Mercantile Exchange, as market price is lower than cost price of Tehran Mercantile Exchange sales.
This week flat products market would be silent in Iran because of holiday sentiment of the market. By increasing price of 2 mm HRC, traders would start selling to destock inventories, also imported CIS origin HRC would be available in near future in Iran, so a falling trend in prices is expected due to increasing supply.
IF Mobarake Steel mill doesn’t change its policies, maybe the possible falling trend would be for a short term. Otherwise, due to falling demand, down ward trend of flat products prices would continue till autumn.
Iran Steel Service Center