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Iran Steel Market Trend in Week 16th, 2022

Iran Steel Market Trend in Week 16th, 2022

Billet

Billet price started to decline slowly during last week due to market confusion and hope of lower prices, from USD 649/mt to USD 645/mt, but finished the week at USD 649/mt, lack of interest in purchasing DRI was also another sign of market sadness.

Also last week, according to Metal Bulletin, average price of Iranian export billet decreased from USD 682-695 /mt to USD 683/mt FOB.

Long Products

Expecting downward trend slowed down upward trend of rebar. Its price at IME is still higher than spot market, and this led to the non-acceptance of rebar sale at IME. Spot price changed from USD 734/mt to USD 732/mt ex-work including VAT.

I-beam market started the week at USD 663/mt, experienced some fluctuations and finished the week at USD 670/mt ex-work including VAT.

Flat Products

HRC 2 mm thickness ex-work Mobarakeh was USD 990 /mt on last Monday, which reached USD 999/mt by Wednesday. Thicknesses 3 -15 mm had a downward trend due to lack of demand. Lower slab price in global markets strengthened expectation of lower domestic prices.

Oxin co HRP had a slow market and its new price came to support the market. Its average market price changed from USD 1098/mt to USD 1094/mt.

CRC was almost stable during the week at USD 1104/mt, higher supply from Mobarakeh Steel co by end of the week made price down to USD 1085/mt.

Lower HRC market made HDG also downward from USD 1220/mt to USD 1207/mt ex-work including VAT.

Weekly Analysis:

The market was still shocked after announcement of export taxes.  Generally, market was quiet and silent as Religious Mourning Holiday was also coming. There was no buyer in the market. This market trend was contrary to the upward trend at IME. This week, prices at IME will decrease and will cause a severe recession. In the world market, prices are falling and this issue has concerned traders not only in Iran and all over the world. The main reason for this is two factors. The first is the spread of the pandemic in China and the second, supply of cheap Russian products in global markets.

This will end in lack of interest in domestic market. As a result, producers will face liquidity problems. The liquidity problem will force them to give points to buyers, so the price trend will be downward until producers reduce production level. In this case, prices would go up again.

Current market sentiment will be disrupted by several factors:

 The first one would be opening of Chinese market which as seen before, end in higher demand and rising prices.

The second factor that changes market condition is power outages in the coming months, which will lead to a sharp decline in production and supply of goods.

The third is the transportation problem, which is quite serious these days, and if the north-south corridor become activated, the problem will become more catastrophic.

It should not be forgotten that the recession in the domestic market will lead to an increase in exports, and this will help balance supply and demand level. In the event of power outages, supply will actually lag far behind demand.

Iran steel market has become very sensitive, which is why its reaction time has been shortened. Government's efforts to calm the market will not be succeeding without consultation and cooperation of producers.

CBI weekly average ex-rate for Steel Products (SANA): Rials 244,342/ 1USD

25 Apr 2022

M.Chitsaz

Iran Steel News Bulletin

IFNAA.IR

IRSTEEL.COM

Apr 25, 2022 13:38
Number of visit : 811

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