Billet
Billet price was downward during last week
in Iran. Average price declined from USD 415/mt to USD 409/mt ex-work including
9% VAT.
Prices were downward due to lower ex-rate,
market cautiousness and general long products quiet sentiment of Holy Month of
Ramadan.
Price trend at IME (Iran
Mercantile Exchange) was also downward. Khouzestan Steel co sold its billet at
USD 383 /mt ex-work excluding VAT on May 19, 2019, rising by USD 24/mt compared
to previous transaction. Arfaa Steel co which sold 8,000 tones of its billet by
the same date at base price of USD 385/mt, after 3 days sold the same tonnage
of billet at USD 375/mt. Market expect more quietness in coming weeks,
therefore, prices won’t be upward.
Global slab and billet
markets were active during last week, this will help Iran export market
activities too. In coming 2 weeks, domestic market will be almost closed but
export activity won’t be stopped. Besides, DRI and iron ore pellet prices have
not changed significantly and recently DRI export to Turkey is becoming more
serious.
Long Products
Long products were
also downward. Average price of debar diameter 8-32 mm dropped from USD 474 /mt
to USD 464/mt ex-work including 9% VAT, as ex-rate dropped
sharply in free market and also export and domestic demand declined.
By Wednesday, as ex-rate improved, market
sentiment became positive and average price rose by USD 5/mt compared to bottom
of USD 460 /mt on Tuesday.
I-beam price also
experienced the same trend as average price of sizes 14-18 mm of Esfahan Steel
co dropped from USD 450/mt to USD 440/mt ex-work including 9%
VAT by Tuesday, but by Wednesday improved a little to USD 448/mt.
Flat Products
HRC 2 mm thickness from Mobarakeh Steel
co declined from USD 643 /mt to USD 623 /mt ex-work including 9% VAT by end of the week and demand was scarce. Ahwaz
Rolling and Pipe Mill co product also dropped from USD 599.5/mt to USD 574/mt
ex-work including VAT. For thicknesses 3-15 mm, prices were fluctuating from USD
632/mt to USD 616/mt and finally by end of the week up to USD 619/mt ex-work
including 9% VAT.
Oxin co HRP market was more depressed and
price declined from USD 604/mt to USD 591/mt ex-work including VAT. Kavian co
HRP also experienced same fluctuation.
Flat products traders were not expecting
such a negative trend and market quietness.
CRC market also experienced the same trend
and decreased from USD 772/mt to USD 760/mt. Reasons behind these fluctuations
could be seasonal sadness of Holy Month of Ramadan, lack of demand and mostly due
to ex-rate current fluctuations.
Market insiders are waiting till end of
Ramadan for possible improvement in prices.
Last week official statistics for
production and export of raw materials, crude steel and finished products was
released for first month of current Iranian year ( 21 March- 20 April). We had an interesting improvement in production
of raw materials like iron ore concentrate, pellet, DRI and crude steel.
Statistics for second Iranian month would be better. Besides, export level has
also increased significantly and the most rise was seen in semi products. Khouzestan
Steel co export level has rose by 96%, Hormozgan Steel co by 40% and South
Kaveh Steel co by 25%.
These numbers are encouraging but it should
also be noted that:
1-
These numbers belong to contracts
finished 3 or 4 months ago before USA sanctions against Iran Steel export. Generally
experts believe that sanctions won’t affect Iran Steel export but export
statistics of coming months will make market more clear.
2-
We are in Holy Month of Ramadan and demand for exporting Steel specially for
long products has declined. But after the Ramadan, domestic market will be
faced with limited billet supply level because debar export level will rise
suddenly. At the moment slab supply limitation is obvious and is likley to
became worse if global slab Price rises.
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CBI
weekly average ex-rate for Steel Products (SANA): Rials 106,755 / 1USD
26 May,
2019
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Iran
Steel News Bulletin