Billet price was downward from USD 535/mt
to USD 517/mt ex-work including VAT in Iran domestic market. Global prices
improved a little in some places, and base price at IME (Iran Mercantile
Exchange) also increased on weekly basis but possibility of lifting sanctions
and lowering exchange rate made prices downward.
In rebar market, despite positive
sentiment of beginning of the week, with the news about progress of nuclear talks,
market became almost stopped and this led to lower prices as average rebar
price dropped by USD 11/mt to USD 599/mt by end of the week.
Despite limited supply level, lower
demand and market’s waiting policy made I-beam average price decline by USD 10/mt
to USD 680/mt ex-work including VAT.
Price of HRC 2 mm thickness ex-work
Mobarakeh was USD 722 /mt on last Saturday, which reached USD 691 /mt by
Wednesday. Oxin co HRP was almost unchanged as the mill is controlling the
market. Possibility of mill maintenance in coming week will make its supply
level more limited. Its average price was changed from USD 951/mt to USD 938/mt
ex-work including VAT. CRC price was down from USD 1053/mt to USD 1040/mt. Lower
sale price of Mobarakeh steel co product affected its market trend.
Lower HRC market made HDG price also
downward from USD 985/mt to USD 975/mt by end of the week. Lower ex-
rate also reduced zinc price, which naturally affect HDG market.
In global markets, China is not really
active yet. In order to comply with environmental issues as well as power cuts,
steel production in China will decrease, which will affect its market inventory
too. On the other hand, billet price has slightly improved. Oil is still
hovering around USD100/barrel, so the possibility of much billet price decrease
is weak. Drought in Europe and higher energy costs have increased steel
production cost in Europe to rise, this has affected European projects. In any
case, it seems that global prices have reached their bottom with a fluctuation
range of USD 20-30/mt and the possibility of more reductions is not much likely.
In domestic market, politics, not
economics, is ruling the market at the moment.
The political atmosphere caused by possible
imminent signing of the JCPOA (Nuclear Deal) has kept all economic activists in
a state of waiting. General expectation is that with approval of the JCPOA, currency
rate will drop sharply, but this is not possible due to several economic
reasons. Of course return of blocked moneys from abroad will greatly open hands
of the government to settle its debts to the banking system and industries will
be more active. But in the current situation, due to the
waiting mode that traders have assumed and the heavy losses they have experienced
due to the wrong policies of IME, production is coming to a halt. In the
current situation, waiting policy will continue.
CBI weekly average ex-rate for Steel
Products (SANA): Rials 263,247 / 1USD
22 August 2022
Iran Steel News Bulletin