Due to disrupted
billet supply from CIS and higher DRI price, Iran billet export price
increased. Control of IME ( Iran Mercantile Exchange) market and the
cancellation of Khuzestan steel deal made upward trend slower at IME, but the spot
market went its own way and the upward trend continued. Average price of billet
changed from USD 632/mt to USD 656/mt ex-work including 9% VAT.
Also last week,
according to Metal Bulletin, average price of Iranian export billet FOB price
increased from USD600 - 603 /mt to USD 680 - 700 /mt.
Billet upward trend along with higher export prices and the heavy volume of
received export orders of rebar, raised domestic rebar price. Inflationary
expectations fueled this trend too. Its average price increased from USD 699/mt
to USD 727/mt ex-work including VAT.
I-beam price didn’t change much and made market surprised. I-beam is also
cheaper than billet price. The main reason is lack of demand. But this will not
really last much.
HRC 2 mm thickness ex-work Mobarakeh was USD 952 /mt on last Saturday, which
reached USD 973 /mt by Wednesday. Mobarakeh Steel co HRC market was upward,
mainly due to global issues, not domestic demand. This trend is likely to
continue because slab price is also rising abroad.
Oxin co HRP price increased from USD 1064/mt to USD 1104/mt by end of the
week as some traders refused to offer. The mill also closed sales while slab price
reached near USD 750/mt. Therefore, this upward trend will continue.
Kavian co HRP was upward from USD 1019/mt to USD 1049/mt, but the mill was still
controlling the market.
CRC price remained almost unchanged at USD 1185/mt due to lack of demand. Therefore,
upward trend of HRC was not transferred to CRC market. HDG price improved due
to higher HRC price from USD 1184/mt to USD 1209/mt ex-work including VAT.
Vienna talks has not
ended in any signed agreement yet. If it doesn’t happen, this current situation
would continue and prices will stand firm until May. After that, due to price
of oil and scrap, the market may calm down, if the external conditions remain
If an agreement is
signed, the market will continue to improve because government demand comes to
the market too.
The Ukraine conflict
has affected our steel market and for the next two months it will coordinate
itself with oil above USD100/ barrel and supply shortage of Russia and Ukraine.
It will improve Iran export market. IME control over prices will put pressure
on mills and make the spot market more profitable. mills will offer
fewer products on IME to take advantage of spot market.
The next two months
belong to exporters, but so do the following months too.
There are some talks
about announcing steel export duties. This is not an easy task because mills
have a chance to breathe in this current situation. And this kind of decisions
are for the time of stability, not the current state of emergency. Usually, announcing
new duties happen in many countries very fast but its elimination has many ifs
CBI weekly average
ex-rate for Steel Products (SANA): Rials 238,346/ 1USD
14 Mar 2022
Iran Steel News