Billet
Billet price continued downward trend during
last week in Iran domestic market under the pressure of IME (Iran Mercantile
Exchange) with the expectation of weak demand. By end of
the week it was down by USD 1/mt to USD 506/mt ex-work including VAT.
Long
Products
Rebar market had a steady trend at around USD 591/mt
ex-work including VAT. It was faced with limited inventory level as production
has decreased but prices remained stable due to lack of demand. This trend may
increase prices.
I-beam market has reached the bottom level like
rebar and its downward trend has stopped. Average market price changed from USD
647/mt to USD 655/mt ex-work including VAT by end of the week.
Flat
Products
Finally, sellers'
resistance came to an end and HRC price improved, but demand is still calm.
HRC 2 mm thickness rose from USD 934/mt to USD 937/mt.
HRP market is
still facing low demand, but resisted against downward trend of prices. Its
average price improved from USD 838/mt to USD 842/mt ex-work by end of the
week.
Lack of demand
made CRC price a little downward from USD 1110/mt to USD 1108/mt.
Shortage of
demand made HDG drop from USD 1102/mt to USD 1093 /mt ex-work including VAT.
Weekly Analysis:
In the world
market:
World market is facing with an upward trend in the
prices of iron ore, scrap and billet, while demand is not serious. The reason behind the
price increase is year-end stockpilings, and from mid-December the condition
may return to three months ago. Chinese government also reacted against iron ore price increases.
All these signs show the pressure of governments all over the
world to control inflation, it doesn't seem like there will be any serious
change in the market in the coming weeks, except the positive sentiment caused
by year- end deals, which cannot be considered as a criterion for judging real market
trend.
In the domestic market:
Last week, domestic market was practically
half closed for three days due to the Metafo exhibition. Presence of exchange booths and Chinese traders in the event was significant, while
the main market leaders were mostly absent.
On Monday, it was rumored that mineral export
duties have returned and will be retroactive. The news made market shocked,
but on Wednesday, there were talks refuting this matter. In any case, according
to the downward trend of billet at IME, the base price of DRI to be offered
next Saturday at IME was announced below USD 289 /mt excluding VAT. Therefore,
the market is expecting more declines in billet price, but the point is that
billet price is at the bottom. Many rebar and billet producers are offering
with delayed delivery which show lack of market inventory and is caused by liquidity
shortage. Last year, the same situation was experienced until the stock market
stopped downward trend of prices.
This trend is a warning, although the
government is looking to reduce inflation but inflation rate nearing the
interest rate is a sign of stagnation, and if the government does not react, we
should expect an economic crisis.
CBI average ex-rate for Steel Products (SANA): Rials 379,891 / 1USD
04 Dec 2023
M.Chitsaz
Iran Steel News
Bulletin
IFNAA.IR
IRSTEEL.COM