Last week Iran market was close four days due to national Holidays,
therefore steel market stayed almost quiet. Besides, China market was still not
active after Lunar New Year Holidays which made iron ore upward trend stopped and
its price declined from higher than USD90/mt cfr China to around USD 86/mt. Within
last month billet price in global markets also has improved by around USD 80/mt
which has made Iran billet export market more interesting and attractive as
average billet export price has been USD 400-420/mt fob Iranian ports. Higher
export interest made domestic supply limited and DRI price rose to higher than
USD161/mt ex-work excluding 9%VAT within last week and is expected to be higher
than USD 173/mt in coming days. This upward pressure reached pellet market too
and is around USD 92 /mt ex-work excluding 9%VAT.
Iran finished steel export market is active. Khorasan Steel
co offered 7000 tones of its debar at IME and was faced with more than 22,000
tones demand. Supply shortage made price improve by around 24% to around USD
453/mt ex-work excluding 9%VAT. As base price increased to more than USD 462/mt
at IME, billet price increased to USD 450-456/mt ex-work including 9%VAT. The
gap between debar cost price and billet is now around USD 46 /mt which is not favorable
for re- rollers but enough for continuing their production.
HRC had an active market
mainly due to limited slab supply level. Prices were upward as Ahwaz Rolling
and Pipe co HRC 2 mm thickness rose to USD 585 /mt ex-work including 9%VAT.
Price of other sizes also were upward.
Kavian co HRP was still unavailable in the market and Oxin
co HRP inventory has reached low levels. Therefore HRP price from Oxin co improved
to USD 519/mt ex-work including 9%VAT. Mills’ slab inventory is enough for producing
HRP but as slab base price has improved by average of USD 46/mt compared to a
month ago, therefore, new HRP production would be at higher cost prices. Due to
this point, sellers were too cautious last week.
CRC also followed the general uptrend. Mobarakeh Steel co
new supply may be welcomed more this week while HDG was faced with price bubble
and sellers were moving cautiously.
The week ahead will be a stormy week, which may determine market
trend for the next Iranian year.
Far east market should justify itself with new billet prices
which is a good chance for Iran Steel market. Higher export level may make
billet and slab shortage in domestic market highly possible in next Iranian
Year ( from 21 March onward) which will consequently lead to higher long and
flat products prices.
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CBI weekly average ex-rate for Steel Products
(SANA): Rials 86,650/ 1USD
18 Feb, 2019
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Iran Steel News Bulletin