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Iran Steel Market Trend in Week 48, 2014

Billet

Billet price was downward during last week in Iran. By beginning of the week mills had high inventories, so tried to increase sales level. Billet size 120 mm in domestic market dropped to Rials15.6 million/mt ex-works including 8% VAT and size 150 mm was down to Rials16 million/mt ex-works including 8% VAT. By Wednesday, some mills were offering Chinese billet with delivery from 30th Nov from Bandar Imam Khomeini. As market inventory level will increase by this Chinese products, billet price won’t increase in coming days in Iran. Besides, scrap price has dropped around Rials700,000-1,000,000/mt which affects billet market negatively.  Another pessimistic view behind billet market sadness is the downward trend in long products market during last week.

Chinese billet is around USD450/mt cfr Imam Khomeini Port with LC payment at the moment, though its cost price won’t be higher than Rials16.4 million/mt including custom duties and 8% VAT. CIS billet is also around USD460-470/mt cfr Northern Ports which is not economical to import for Iranian traders at the moment.

It should be noted that at the moment main problem for market participants is not billet cost price but its demand which is downward day by day.

 

Long Products
Long products experienced a downward week and were down by up to Rials300,000/mt. market participants expect this trend continue due to lack of demand. During current Iranian year, long products sale price had been lower than a year ago despite higher production costs. Average price of debar in September 2013 was around Rials19.327 million/mt but it was around Rials18.532 million/mt September this year. Billet average base price was Rials15 million/mt excluding VAT during last Iranian year but has reached Rials16 million/mt including VAT in current week.

At the moment Iranian domestic steel mills are facing with lack of liquidity. Investors are not interested in working at steel market as it is not economical. This trend has started from last year and need more attention from government related authorities to solve the problem.

 

Flat Products
Price of hot rolled steel coil with 2 mm thickness improved by Rials300,000/mt to Rials20.2million/mt on truck in Anzali including 8% VAT. Nuclear Talks with G5+1 finished, so market participants ambiguities end, besides exchange rate fluctuations made prices increase. HRC thickness 2.5-6 mm had a stable week despite lack of demand. For sizes 6-15 mm thickness import cargoes competition increased, so prices dropped by Rials200,000/mt . HRP market was quiet and almost stable.

CRC market experienced around Rials300,000/mt rise in base price of domestic leader Mobarakeh Steel Co, but retail market was almost stable. Market inventory level is low but demand is also scarce.

HDG market is facing with low supply level which made prices increase by Rials100,000/mt . Supply shortage is expected to continue in coming weeks.

 

Ex-rate:
In Exchange Room: Rials 26,847 1USD       
In free market: Rials34 ,150/1USD 
Iran steel service center

Nov 30, 2014 09:37
Number of visit : 895

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