market was faced with a limited supply and Khuzestan steel co credit sales
heated up the market. Re-rollers are mostly in shortage of billet, and this has
made demand level up. Its average price improved from USD 653/mt to USD 664/mt
ex-work including VAT.
The market did not believe in rebar
upward trend,therefore, its demand level at IME was at the minimum, and the
competition was mostly on credit sales, but the fact is that most of re-rollers
do not have enough stock of the product, and this caused the price increase in
the market from USD 743/mt to USD 768/mt ex-work including VAT.
Limited supply level and rumers about possible
stoppage of Esfahan Steel co production in the coming year in Iran, made I-beam
upward from USD 941/mt to USD 1026/mt ex-work including VAT.
Price of 2 mm thickness HRC ex-work Mobarakeh was USD 1158 /mt on
last Sunday, which reached USD 1200 /mt by Wednesday. HRC had ups and downs due to market concerns and
the possibility of price falling back at IME, but on the weekend, the market's
confidence was strengthened and prices improved.
Oxin co HRP delivery is limited yet and higher
slab price in global markets also affected HRP price to rise from USD 1072/mt
to USD 1114/mt ex-work including VAT.
CRC market is facing
with a severe supply limitation right in its consumption season, and this has
brought the price to its peak. Last week it rose from USD 1591/mt to USD 1729/mt.
Higher HRC price and
lower supply level made HDG also up from USD 1537/mt to USD 1718/mt.
Prices remained strong in
the global market. A possible decrease in OPEC+ supply will help increase oil
prices, while the Russians' share of the oil market will decrease due to USA
pressure. Therefore, the role of OPEC will be more prominent, in this case, oil
price will remain stable, which will not allow billet price to decrease.
The earthquake in Turkey
is by sure a human disaster, but in the coming months, demand for billet, rebars
and scrap will increase in this country, since CFR scrap in Turkey is one of
the global scrap market indicators, at least in the next three months there
should be no news of a decrease in the price of scrap. unless the scrap from
the Turkish earthquake fills part of the demand, which it takes time.
Views are different in
the domestic market. One view believes that with warmer weather and the
improvement in the supply of DRI, billet price will decrease due to the
increase in supply. This view sees the price of DRI in the range of USD 246-281
and billet at the base of USD 561 /mt. The most important argument of this
group is the government's pressure on the currency of USD1 / Rials 285,000,
which does not allow the price to increase despite the increase in the volume
The second view believes
thathigher DRI and billet supply will be neutralized by three factors: First,
the increase in gas, power, wages and freight rate
Second, the competition at
IMEto buy, which raises the price.
Third, increasing demand
and export prices. Also this group don’t believe in a stable currency rate.
If we leave all the equations
aside, what determines the market trend is the exchange rate. The exchange rate
is important not as a price determining factor, but as a driver and direction
of the market.
CBI weekly average ex-rate for Steel
Products (SANA): Rials 285,000/ 1USD
13 Feb 2023
Iran Steel News Bulletin