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Iran Steel Market Trend in Week 18th, 2022

Iran Steel Market Trend in Week 18th, 2022

Billet

Iran steel market had a short working week as Eid al-Fitr Holidays was coming last week. Due to the upcoming Holidays, billet market remained almost unchanged at USD 638 /mt ex-work including VAT during the week. Billets offered at IME also were not ended in any deal as their prices were higher than spot market rate.

Long Products

Rebar price was also almost unchanged at USD 719-720/mt ex-work including VAT. I-beam market was also in Holiday mood at USD 661/mt.

Flat Products

HRC market was quiet due to absence of big traders and its price has reached the bottom level. HRC 2 mm thickness started the week at USD 995/mt and was USD 1016/mt ex-work Mobarakeh before market was closed for Holidays on last Monday.

Oxin co HRP was stable at USD 1074/mt. Big traders were absent and prices are at the bottom.

CRC was also unchanged at USD 1185/mt and HDG at USD 1186/mt.

Weekly Analysis:

Downward trend in all market parts recently has caused concern among economic actors. Downward trend of prices in the world market along with opening of the negative 3% range in IME has caused traders to withdraw from buying from the exchange market, which is quite logical. The fact is that spot prices are lower than IME. The stock market has its own criteria and the spot market has its own. The reason behind lower prices in global and domestic market is limited demand. Demand in the global market has dropped sharply due to the holy month of Ramadan and the long Eid al-Fitr holiday in Muslim countries. The Chinese market is virtually inactive due to Covid restrictions. In the Islamic countries the market will be active after a month these days.

In China, the government is fighting hard against coronavirus epidemic and has taken economic measures to avoid a recession that will lead to a boom in construction after the pandemic disappears. Chinese are also expected to return to the market within the next month, so the market will be faced with delayed demand coming in next weeks.

But on the supply side, Ukraine supply has been completely destroyed and Russian products are facing sales problems due to very severe sanctions. Russia's foreign trade is expected to fall by 30% in the next three months. On the other hand, the imposition of duties on Iranian export has also caused Iranian mills to withdraw from export market within the past month.

 Thus, on the one hand, world market is facing with suppressed demand, and on the other hand, with the supply being reduced, prices will naturally rise after demand problem is resolved, because Russia steel supply in the world market will be limited.

In the domestic market, lower demand had made buyers absent. Return of prices to March level is also impossible, as cost prices have risen, especially wages and freight. Power outages are imminent too, so there is potential for increased demand and reduced supply in both the domestic and foreign markets. For this reason, the downward trend in prices cannot continue.

CBI weekly average ex-rate for Steel Products (SANA): Rials  248,104 / 1USD

09 May 2022

M.Chitsaz

Iran Steel News Bulletin

IFNAA.IR

IRSTEEL.COM

May 9, 2022 12:51
Number of visit : 239

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