Billet price was
downward during 3rd week
of 2015 in Iran. Esfahan Steel Co offered billet size 150 mm by Wednesday at
IME and succeeded in selling 21,000 of it at Rials14.05 million/mt base price.
As long products demand level is at the bottom, more declines in billet price
is likely. But market participants believe price decline won’t be more than
Rials1million/mt. If prices decrease more, many small mills will face
bankruptcy. Khouzestan Steel Co also offered 30,000 mt of its size 150 mm
billet at IME with base price of Rials14.05 million/mt the same day as Esfahan
Steel Co but couldn’t sell any tonnage.
Billet price has reached
bottom in global markets and it is being offered at USD390/mt cfr Anzali port
in Iran. Market participants are concerned about Chinese billet competition as
they would accept any decline in prices to save their share of the market.
Lower iron ore and crude oil price has led to lower cost price and also
decrease in freight rates.
At the moment Iranian
leader mills have competitive strength for domestic supply, so Chinese billet
is not being imported to Iran. But demand level is low and prices are downward,
so market future trend is not positive.
Long products market
experienced one of its most quiet weeks in Iran. Debar price declined by
Rials300,000/mt, but it didn’t help transactions level. Market participants are
staying out of market expecting more declines in prices which is a logical
anticipation in current situation. Real demand level is also scarce. All these
negative factors talk about more downward prices in near future.
If this situation
continues and buying interest doesn’t improve, long products market would
experience a crisis. Other long products like I-beam, angle and UNP were also
downward. As Angle and UNP price dropped by Rials200,000-500,000/mt and I-beam
price was down by Rials100,000-500,000/mt.
Price of HRC 2 mm
thickness declined significantly during last week in Iran. It decreased from
Rials18.7million/mt to Rials17.9million/mt on truck in Anzali including 8% VAT
due to three main reasons as following:
1- Lower ex-rate.
2- Lower global prices
and extreme competition between CIS and Chinese suppliers.
3- Arrival of around
200,000 tones of HRC 2 mm thickness
which were stockpiled in Astrakhan port due to wintery condition.
expect HRC price downward trend continue and reach Rials17.5million/mt
including 8% VAT. Importers are facing with huge loses at the moment and many
small traders are stopping ordering. Downward trend in prices will be faster
and heavier. It
is expected that within a short time HRC price would decline by USD50-70/mt. It
may be noted that at the moment freight rate from China to Iranian ports is the
same as from Astrakhan to Anzali port. Besides, lower Ruble rate against US
Dollar has made Russian pipe and profile more competitive in Iran's traditional
export markets. The only solution to this problem would be change in ex-rate or
new policies to support Iranian pipe and profile exporters.
price of HRC 2.5-15 mm
thickness dropped by Rials
100,000-300,000/mt. Supply level was low but sellers prefer reducing inventory
level today than selling at lower prices in near future. This policy made
downward trend faster.
Oxin co offered HRP in
the market. Besides, Chinese product was available in Imam Khomeini Port.
Market was quiet, with lack of activity the common trend.
CRC market experience
downward competition between importers as Kazakhstan origin CRC average price was down from Rials 23.4
million/mt to Rials 22.2 million/mt on truck in Anzali including 8% VAT.
Some participants think
importers are yet making profit from current prices, so there is room for more
declines. It should be noted that importing HRC thickness more than 3mm, CRC
thickness more than 1mm, HDG thickness more than 1mm won't receive currency
allocation from exchange room anymore, so their cost price would increase at
least 18%. Global prices are dropping quickly but it won't cover all this 18%.
Therefore many market participants expect CRC downward trend stop in near
HDG price was downward
like CRC. It dropped by Rials
In Exchange Room: Rials
In free market: Rials 34,420 /1USD
Iran steel service center