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Iran Steel Market Trend in Week 39th , 2015

Billet

Billet price dropped slightly during last week in Iran. The reason behind this stability was low supply level from Khouzestan Steel Co and Arfaa Steel Co. Other producers were offering billet with Rials100,000-200,000/mt discount.

Domestic billet size 150 mm was being offered at Rials11.5-11.6 million/mt ex-works including VAT, with a mill offering at Rials11.4 million/mt. Generally there was no interest in buying.

Market participants expect possible decline in billet price not more than Rials500,000/mt as domestic billet price is near bottom in Iran. Billet price is almost the same as 3 years ago, but all production costs have increased. Therefore the only way for the mills would be production cut to survive in this situation especially for private sector mills. Production cut will balance supply – demand but meanwhile producers will be in lack of liquidity and can’t pay their bank loans.

 

Long products

Long products were downward during last week in Iran by up to Rials200,000/mt. Average price of debar diameter14-25 mm declined by Rials500,000/nt in Ahwaz market to Rials13.75 million/mt. The same product in Esfahan market was down by Rials150,000/mt to Rials14.1 million/mt. Price of I-beam size 14-18 mm was stable in Esfahan market at Rials16.65million/mt ex-works including VAT.

Angle and channel generally had a stable market. Some sizes of channel were up by Rials200,000/mt, market was depressed  and transactions’ level was limited. Traditionally, during last week of summer this upset trend is usual.

Investors mostly expect no especial improvement in Iran long products market. Long products deals were mostly in I-beam section due to especial policies of market leader Esfahan Steel co. The mill sold 76,000 mt of I-beam and debar and also 50,000 mt of I-beam size 14 and 16 mm during last week at  IME( Iran Mercantile Exchange) but these sales are not showing general trend of the market.

 

Flat products

Imported HRC 2 mm thickness was stable during last week in Iran at Rials15.2 million/mt on truck in Anzali including 9% VAT, but Chinese product dropped by Rials100,000/mt to Rials14.85 million/mt on truck in Imam Khomeini port including VAT. It is a buyer’s market as supply level is high. During last Iranian month, import level increased by 159,000 mt to 189,000 mt. Average monthly import level of HRC  2 mm thickness during first 5 months of Iranian calendar ( started at 21 Mar 15) has been 55,500 mt, but it more than tripled by last month. Import prices are downward and Iranian buyers are resisting from finalizing deals. They believe prices will continue downward. Chines 2 mm HRC is USD320/mt cfr Imam Khomeini port, USD30/mt lower than a month ago. Buyers expect Chinese product reach USD280/mt cfr southern ports in coming future.

 For sizes 2.5-6 mm thickness, market leader Mobarakeh steel co didn’t change its price. Meanwhile global prices are downward and the Iranian mill should follow this trend sooner or later.

HRP market was volatile during the week as Oxin co HRP thickness more than 20 mm, improved by Rials100,000/mt to Rials17.45million/mt ex-work including 9% VAT due to delay in delivery from mill. Kavian co HRP was also in the same trend but generally market was weak.

CRC market was quiet. CRC monthly import level has declined from 31,000 metric tones to 23,000 mt during last Iranian month ( 23 Aug-22 Sep) as import price has declined from USD420/mt to USD350/mt cfr Imam Khomeini port during last month. Therefore, importers hold wait and see policy. In domestic market prices also have declined by Rials300,000. Market future sentiment is not clear. Import level may continue declining as currency allocation from exchange room for this product has stopped. Besides, consumption season of CRC has begun.

HDG market was depressed with prices down by up to Rials300,000/mt.

 

Ex-rate:
In Exchange Room: Rials29,955/1USD       
In free market: Rials33,910/1USD

Iran Steel Service Center

Sep 27, 2015 08:00
Number of visit : 1,265

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