Billet
Billet market remained almost stable during last
week in Iran domestic market. Despite lower ex-rate
and market stagnation, concerns about higher gas and electricity price helped
to stabilize billet price.
Its average price changed from USD 571/mt to USD 275/mt ex-work
including VAT.
Long Products
Rebar price was faced with a limited drop from USD
672/mt to USD 669/mt. Demand level is at
the bottom and market is expecting downward prices in coming days.
I-beam had a stagnant market and changed from USD 720/mt
to USD 712/mt. Downward trend will
continue in coming days. Long-term sales of Esfahan
Steel co helped maintain prices.
Flat Products
HRC 2 mm thickness decreased from USD 866/MT at the
beginning of the week to USD 853/MT ex-work Mobarkeh by end of the week. Lack of demand and higher
number of offers by some traders lowered prices.
HRP market sentiment is downward but lower supply
level didn’t let oxin co price drop and stayed at USD 854/mt ex-work including
VAT. Kavian co and Mobarakeh steel co prices have declined, therefore, Oxin co
HRP will be downward too.
The downward trend in the price of CRC continued
due to weak demand from USD 1237/mt to USD 1194/mt.
The downward trend of HRC and ex-rate, along with
the stagnation of demand, put pressure on HDG market and its price dropped from
USD 1249/mt to USD 1238/mt.
Weekly
Analysis:
In the world
market:
Global markets continued to be downward. Billet price of USD
450/mt fob seems to be near. This trend is also evident in slab and flat
products market. The drop in prices causes
the demand to fall and double pressure on the prices. The depreciation of
Yuan strengthens the invasion of Chinese goods, which are a strong competitor
for our exports. There is no news about
serious demand, we have to wait until next month. Talks about BRICS currency have confused the markets,
but USD cannot be easily removed in terms of the power it has in the financial
structures of the world markets, such as the International Monetary Fund, the
World Bank, and the like. It should also be
noted that removing the USD means a severe economic crisis. In fact, it is not
so easy to use yuan or any other currency instead of dollars.
In the domestic
market:
Month of Muharram is coming and the market will
traditionally stagnate for two weeks. There is no
incentive in the market due to weak demand. The pressure of the
government to reduce the prices has gone so far that it has started
against the price of petrochemicals and steel, while the share of the
government in the production of petrochemicals and steel is not comparable to
the private sector.
By increasing the price of gas and electricity,
the government eats up the profits of steelmakers to compensate for the budget
deficit. Of course, this is
the budget law, but can it be sustainable? At the moment, the
inventory of the warehouses is sufficient and the market has no demand. Therefore, minerals
should be exported. But what will
happen after that??!!
CBI average ex-rate for Steel Products
(SANA): Rials 371,692 / 1USD
17 July 2023
M.Chitsaz
Iran Steel News Bulletin
IFNAA.IR
IRSTEEL.COM