Billet: Billet price increased due to
supply management and its reduction. Supply problem and DRI price level are the
factors driving the price up.
Long Products
Rebar: The increase in billet price and lower
supply led to an increase in rebar price.
I-beam: The decrease in supply caused an increase
in the price of I-beams.
Flat Products
HRC: Fluctuations in the exchange rate and supply
management caused HRC price to increase.
HRP:
The increase in slab price led to an increase in the price of Oxin Co HRP.
CRC: In the wake of the increase in the
price of slab and hot-rolled coil, CRC base price increased.
HDG: Along with HRC market trend, HDG price also
increased.
Weekly Analysis:
In
the world market: Global steel market is experiencing new
conditions. US tariffs have disrupted the previous trend. Price of
ferro-silicon has almost reached its bottom. Scrap in Russia is decreasing, but
in Turkey, it is increasing. Billet price in China has reached its bottom, but
in the US, it is increasing. Hot-rolled coil and rebar prices have decreased in
Europe, and this trend will continue for the next month. Mexico and South Korea
have joined the world's steel exporters due to US tariffs.
In
the current situation, all eyes are on the next OPEC Plus meeting for oil
prices, but the influence of this organization has become weaker due to
increased production in Angola, Argentina, and the US, and Trump's political
pressures for a larger share of the market from India and China. The US
government's policy is cheap oil but more sales. In any case, billet price has
reached its bottom and has reached the price range of USD 410-430 per ton ex-work
in most parts of the world.
With
the existing conditions, there is no possibility of price decline, but the
condition for price increase is not favorable either. The world needs a new
market. India, with its policies based on national interests, does not create
this potential. Perhaps the only point in the future is the Middle East. In any
case, there is no hope for price change in the next two months.
In
the domestic market: There are two conflicting factors in the Iranian
market that are approaching their intersection point.
The
first factor is the price elasticity in the market. The market does not have
the capacity to absorb billet prices above Rials 300,000. Naturally, slab at Rials
350,000, HRC at Rials 450,000, and rebar at Rials 350,000 are the expected bottom
price for the market.
The
other factor is the increase in production costs. Gas in February has increased
by 172% compared to June, transportation costs have recently increased by 25%,
and there is talk of a wage increase of up to 50%. Considering that the price
increase occurs throughout the chain, it has a cascading effect.
With
the weather getting warmer, according to the Ministry of Petroleum's formula,
if gas prices fall in the world, they will also fall in Iran, as a result of
which price of DRI will decrease and supply of billet will increase, but this
does not mean a significant decrease in the price of billet because
transportation, wages, and electricity costs will not decrease, but price of HRC
and rebar in the market will decrease with the increase in supply.
All
these changes depend on the weather getting warmer and the stability of the
exchange rate. What is seen in the Iranian economy is severe stagflation along
with a decrease in investment and an increase in taxes. What will be the
outlook for this economy?
CBI
average ex-rate for Steel Products (SANA): Rials 668,838/ 1USD
17 Feb 2025
M.Chitsaz
Iran Steel News Bulletin
IFNAA.IR
IRSTEEL.COM