Billet
Billet market was stable during last week in Iran domestic
market and even higher ex-rate couldn’t compensate for the problem of weak
demand and lack of liquidity in the market. Its average price was around USD 587 /mt ex-work including VAT during the week.
Long Products
Rebar price is dealing with lack of demand in
Iran domestic market, therefore, price remained almost unchanged at around USD 666-668/mt
ex-work including VAT during the week.
I-beam had a downward trend from USD 712/mt to
USD 704/mt which lack of demand is the main factor.
Flat Products
HRC 2 mm thickness was USD 926 /mt ex-work Mobarakeh on Saturday, which reached USD 956/mt by
Wednesday. Thanks to the exchange rate change and some
traders holding back from offering, the market went up.
Like Mobarakeh steel co HRC, Oxin co HRP also
improved from USD 848/mt to USD 857/mt ex-work including VAT.
CRC market price trend is slowly became clear
as its demand is improving. Its average price changed from USD 1139/mt to USD 1149/mt ex-work
including VAT.
With HRC upward trend HDG market was also up from USD 1126/mt to
USD 1135/mt ex-work including VAT during lat week.
Weekly Analysis:
In the world market:
Oil price is rising and will probably go up to
USD 100 /barrel. This is due to restocking of China and USA and the flood in
Libya, but cold weather in coming months will be another reason behind upward
trend. Billet and scrap price
has started to rise slowly, with these conditions and maintaining the reduction
of the OPEC+ production ceiling, there is no possibility of prices going down,
this will help Iran's export level. The increase in export is especially noticeable in October and
September. Part of China's
rising oil demand is due to the export of petrochemicals from China, not
actually due to China's own consumption alone. However, this trend
does not seem to change anytime soon.
In the domestic market:
Domestic market is facing with lack of
demand and liquidity problem. Since last week, billet producers have
returned to their production capacity, that's why expectation of price
reduction is quite noticeable. On Wednesday, the new guidelines
for billet and pellet at IME (Iran Mercantile Exchange) limited the competition
of traders in the billet and pellet buying ring, so prices are expected to
decrease, especially for long products. The first effect is
that demand will fall back and wait for the market to stabilize, which will
cause the prices to decrease.
In a situation where the market is very weak
and next holidays coming, the drop in rebar sales that we have seen in the
stock market for the past three weeks will intensify. Mills that do not
sell their billet and rebar at IME, offer them in cash market, but state mills
cannot supply outside the stock market, as a result, they will have liquidity
problems which they are facing now. Of course, the price
reduction in the domestic market is beneficial for these factories because it
increases their export capacity.
In coming Iranian month ( begin from next
week), we will see a drop in the price of billet and long products, an increase
in export and possibly an injection of money. While the due date
of many previous debts of mills and traders is in this month.
CBI average ex-rate for Steel Products
(SANA): Rials 371,399 / 1USD
18 Sep 2023
M.Chitsaz
Iran Steel News Bulletin
IFNAA.IR
IRSTEEL.COM