Domestic market is currently caught between rising currency costs and weak domestic demand. While inflationary pressures (exchange rates) are pushing prices up, the lack of liquidity and "market silence" are preventing any significant rally, keeping most commodities near their price ceilings.
Billet: The rise in currency rates within the secondary Secondary Hall and the open market directly pushed billet prices upward
Long Products
Rebar: Rebar prices ticked up early week following currency gains, but 'market silence' stifled trading activity, resulting in a bearish trend by the weekend.
I-beam: Despite the market maker's ability to keep I-beam prices stable through supply management, overall demand was weak and the market remained in a recession.
Flat Products
HRC: Market stagnation limited the price movement of HRC, especially as prices have already reached their ceiling.
HRP: The market maker’s control over supply, combined with rising exchange rates, led to an increase in Oxin Co HRP prices.
CRC: Despite very sluggish demand, CRC market remained supported by a shortage of certain sizes and rising exchange rates.
HDG: HDG price fluctuated in line with currency volatility; however, despite weak demand, there is currently no room for price reductions.
Weekly Analysis:
In the world market: With global markets closed for the holidays, price trends largely mirrored the final weeks of December. However, two significant developments emerged:
1. Oil Prices: As anticipated, oil prices declined, a trend that is likely to persist.
2. China’s Silver Export Policy: The Chinese government's decisions regarding silver exports have intensified the likelihood of a price surge. This is critical for the solar energy sector, as silver is a primary component in solar panels. Should silver surpass $130 per ounce, solar power may lose its economic viability. Market reactions will become clearer once trading resumes post-holidays.
Weekly Snapshots:
• Oil: No transactions due to market closures.
• Iron Ore: Rose slightly from $107 to $108 CFR China.
• Scrap: Remained stable at $370 CFR Turkey.
• Billet: Held steady at $434 FOB Black Sea.
• Rebar: Quoted at $560 FOB Iskenderun (Turkey) and $463 FOB Chinese ports.
• HRC: Unchanged at $435 FOB Black Sea.
A key factor to watch post-holidays is China’s strategy for steel export controls. While the impact remains uncertain, Chinese government is not seeking to lower prices; rather, it aims to regulate and steer market competition.
In the domestic market: Last week was dominated by two main points: the fervor surrounding national budget analysis and the seasonal market closure. However, a more subtle powerful driver is the narrowing gap between the Secondary Hall exchange rate and the open market. This convergence has driven up base prices on the Mercantile Exchange, even as the broader market lacks the purchasing power to absorb these increases. Furthermore, geopolitical tensions continue to act as a drag on market momentum.
A critical development poised to disrupt the currency market in the coming weeks is the government's decision to authorize imports without foreign exchange transfer for essential goods. This will likely lead to a rapid influx of goods from Turkey, Dubai, and Pakistan.
Historically—as seen during wartime—this policy tends to exert upward pressure on exchange rates.
As from December 28 all customs duties has been calculated based on the Secondary Hall rate, which will trigger an immediate spike in the cost of imported commodities.
From an economic standpoint, unifying the exchange rate is an absolute necessity, though its success depends on two prerequisites:
1. Global Alignment: Compatibility with international market trends and policies.
2. Domestic Infrastructure: Ensuring internal systems are prepared for the transition. Achieving this amidst sanctions and severe electricity and gas imbalances remains a formidable challenge for the government.
To compensate for projected declines in oil export revenue within the budget, the government is expected to deregulate and incentivize non-oil exports, with Steel playing the leading role.
In Flat products market no significant changes are expected next week as prices have hit their ceiling. Much depends on whether Mobarakeh Steel maintains its current pricing in the next offering.
Long productd market is currently at a market floor. Given the significant gap between Exchange (IME) prices and the open market, a price increase is logical, provided that the current IME trend continues and market activity resumes.
Further price drops in the open market are highly unlikely, as current trading levels are already hovering near the total cost of production.
CBI average ex-rate for Steel Products : Rials 1,325,072 / 1USD
05 Jan, 2026
M.Chitsaz
Iran Steel News Bulletin
IFNAA.IR
IRSTEEL.COM