Billet price was downward
during last week in Iran steel market from USD 649/mt to USD 606/mt ex-work
including VAT. Stagnation of long products market was the main reason behind
this trend, and on the other hand, sharp fall in global markets was the other reason
for lower billet price. Government's efforts to control billet market and
cancelation of Khuzestan steel co deal at IME as a reference mill helped create
a sentiment of distrust in the market.
Rebar price had a downward
trend from USD 740/mt to USD 714/mt ex-work including VAT due to lower global
prices and declining prices at IME. Government signals to lower prices led to
further market frustration.
I-beam price was also
down from USD 698/mt to USD 687/mt , which was affected by similar factors in
the rebar market.
Mobarakeh Steel co 2 mm thickness HRC was
USD 921 /mt on last Monday, which reached USD 886 /mt by Wednesday. Weak
demand, declining prices in global market and talks of further price cuts for
Mobarakeh Steel co prices at IME lowered prices in spot market.
Despite scarcity of some Oxin co HRP items,
downward trend in prices followed from USD 1033/mt to USD 1017/mt and seems to
continue as global prices are downward too.
Due to power cuts, CRC consumption has
reached its minimum level and this is the main reason for the price reduction
as by last week it was down from USD 1166/mt to USD 1156/mt ex-work including
VAT. HDG was also downward from USD 1179/mt to USD 1168/mt due to lower HRC
price as well as demand.
In global market, inflationary
pressures and governmental interferences in economic matters has deepened the
current recession, and Chinese market recession has strongly contributed to
this negative trend. As a result, US export scrap price fell to below USD 300 /mt
FOB on Wednesday, with global billet and slab price expected to fall below USD
500/mt in the coming weeks. Under these circumstances, everyone hopes that Chinese
market activity will stimulate global markets. Ukraine war also along with the
global recession, is not a small phenomenon.
But in Iran market:
on its policies. One of the principles of economic surgery is to keep the
window of foreign trade open, which is completely closed due to sanctions. On
the other hand, Russia's dumping on oil and steel has called into question our
exports in these two sections too. The result would be a decrease in export and
an increase in the currency rate, which will lead to inflationary pressures. It
is rumored that the Commodity Exchange will make changes to its pricing system
and formal exchange rate will increase by to support exports. This would lead
to higher base prices of steel at IME. In any case, incomplete economic surgery
with a recession in the global market has two main consequences. The first is a
recession and the second is an increase in the exchange rate.
CBI weekly average ex-rate for Steel
Products (SANA): Rials 252,903/ 1USD
27 June 2022
Iran Steel News Bulletin