Iran Steel market Trend in Week 39


Billet price was almost unchanged during week 39 in Iran. By middle of the week ex-rate started rising. Billet demand was limited due to low demand in long products market. Buyers preferred waiting and sellers were working cautiously.

If ex-rate stabilizes, billet market would be stable too. At the end of the week, billet size 150 mm was priced at Rials16,700,000/mt, but inventory level at northern ports is limited and it is offered mostly in Imam Khomeini port at southern part of the country.


Long products

Long products market was mostly silent during last week, except Tuesday which ex-rate increase made inquiries rise. At IME supply level of sections was so low during last week. The problem is that price of long products which are supplied in IME at the moment won''t be a profitable price for traders. During last month long products prices were around Rials18,500,000-19,100,000/mt in retail market but it reached Rials17,500,000/mt at IME, which after other cost would be around Rials 18,400,000/mt for buyers. Besides, there are some parcels available in the market, which have been bought at IME at low prices. Market would be stable when these parcels are all sold. Besides current fluctuation in ex-rate has made investors more interested in that market.


Flat Products

2 mm thick HRC was priced at Rials16,800,000/mt on truck in Anzali including 5% VAT at the beginning of week 39, but started rising by Monday and finished the week at Rials17,500,000/mt.

Price of Mobarakeh Steel HRC products increased around Rials100,000-200,000/mt , but mainly 2 factors do not let domestic flat products market improve:

1- Import market increased competition

2- Lack of demand

These 2 factors besides high domestic supply level have made flat products market quiet.

CRC market was full of fluctuations and ambiguities, different prices are available in the market sometimes with Rials500,000/mt gap. Generally during last week, after rise in ex-rate, price of CRC increased by up to Rials600,000/mt in some cases.

HDG market was flat in first half of the week, and then increased by Rials 500,000/mt.

Iran steel market is experiencing a difficult situation. Supply level is generally very limited, but also demand level has dropped. If supply level increase or ex-rate declines, Iran Steel market will face harsh decreases in price which finally is a bad news for producers, mainly those who produce long products from billet.

Low profit margin and high risks in steel market activities have made investors out of market to other markets such as foreign currencies and property market.

(Ex-rate:  Official: Rials 12,260/ USD,   Market average: Rials 26,703/  USD)

Iran Steel Service Center

Sep 30, 2012 15:09
Number of visit : 407


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