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Iran Steel market Trend in Week 28th 2016

Billet

Billet market was downward during last week in Iran. Domestic billet size 150 mm changed from Rials13.5-13.6 million/mt to Rials13.3 million/mt ex-work including 9% VAT by end of the week. As scrap price declined, billet size 120 mm also decreased by Rials200,000/mt to Rials13.2-13.4 million/mt ex-work including 9% VAT.

Long products market is quiet and billet demand is scarce, therefore, any upward trend in billet price seems unlikely, but downward amount also won’t be more than Rials100,000-200,000/mt as raw materials prices are almost stable.

As production cuts will continue for a while in Tangshan province, China, Iranian billet exporters would have a chance to increase sales level. Although this chance is short-lived but would help Iran billet market stay strong for some months.

 

Long Products

Long products prices were stable during first half of last week, but by Tuesday started declining and finished the week at Rials200,000-400,000/mt lower.

Market participants were expecting prices to be upward after Ramadan Holidays, but it was a temporary expectation which became quiet after 3 days. Lack of demand satisfied producers that they have to decline price to reach more sales and avoid liquidity shortage. A small mill reduced its price by Rials200,000/mt and sold 100,000 mt of its debar in a day in spot market. Besides higher supply level of Esfahan Steel co debar in Iran Mercantile Exchange broke price resistance. Downward trend started from Wednesday and would continue this week at a limited pace. Around 70,000 mt of Esfahan Steel co debar has been sold in IME and it is being offered in the market at base price of Rials13.7million/mt excluding VAT. Finished price of these cargoes would be Rials14.95 million/mt including VAT. Besides, other mills are offering their debar at Rials100,000-300,000/mt lower than Esfahan Steel co in the market. Therefore, downward trend will continue.

I-beam downward price trend was also more sensible by end of the week and would continue in coming days at limited speed.

Generally, market participants believe current sadness in long products market would continue for a while as demand is limited and production level is low. Price fluctuations won’t be more than Rials500,000/mt till demand level changes. 

 

Flat Products

HRC 2 mm thickness started week 28 at Rials18.4 million/mt on truck in Anzali port including 9% VAT and custom duties and Also Rials15.7million/mt at BIK port. They finished the week at respectively Rials200,000/mt and Rials100,000 /mt lower. Prices declined as demand was low and Mobarakeh steel co offered its products at Rials18-18.1 million/mt ex-work including VAT in domestic market. This product market sentiment is downward as some rumors talk about high supply level of domestic leader Mobarakeh Steel co and also cheap purchases of CIS origin HRC in near future in the market.

HRC 2.5-6 mm thickness was faced with lack of demand but market leader’s higher supply. Though, prices dropped by Rials300,000/mt and there is no hope for improvement in demand in near future. Thickness 8-15mm was also faced with high supply level from both domestic mills and importers. It has been 2 consecutive weeks that higher supply level is declining prices. HRP thickness more than 15 mm was in limited supply. Thickness 35 mm was not available in the market and its demand level is low. Its import offer has been USD390/mt cfr BIK for Chinese product, but domestic prices are more interesting for potential buyers.

CRC market was almost stable. Market was quiet, but sellers resist against any discount due to limited supply level. CRC import level has not improved yet. Import level was 18,000 mt during last Iranian month (21 May-20 Jun) and around 17,700 mt during last 20 days of current month. It is expected to reach 23,000-25,000 mt for current Iranian month ( 21 jun-21 Jul). Domestic leader Mobarakeh Steel co is also offering CRC in the market with some sizes facing supply shortage. Market participants mostly hope CRC price to be stable at current level. Seasonal sadness is also affecting market activities.

HDG price was almost unchanged due to market inventory shortage. Supply level is very limited and no import cargo was registered in current month. Its domestic production is not affordable too. Any way demand is still limited.

 

Ex-rate:

Official rate:  Rials30,885/1USD
In open market:  Rials35,100  /1USD

11 July 2016

Jul 17, 2016 08:50
Number of visit : 594

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