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Iran steel market Trend in Week 18th, 2020

Iran steel market Trend in Week 18th, 2020

Billet

Billet price has been declining over the past week in Iran. Its average price on last Saturday was USD 381/mt, which reached USD 372/mt ex-work including 9% VAT by Wednesday. Downward trend of billet was due to two main factors:

The first factor is the stagnation of demand in long products market and the second factor is the government's insistence on controlling billet and long products prices at IME (Iran Mercantile Exchange).

The downward trend in billet price has caused DRI price to fall to USD 191-199/mt. Since billet is the most key commodity in steel market, it is very important for the government to pay attention to its price. It is trying to control inflation, which is why it does not allow billet base price at IME to exceed USD 319/mt. Controlling rebar price at IME at maximum of USD 369/mt and I- beam at max of USD 383/mt is also based on the same policy, but the current situation is subject to the conditions of the global markets too. Falling oil prices will lead to a very serious economic problem if global steel demand and prices decline.

Generally, it should be noted that billet price at IME is at the bottom and there is significant gap with retail market prices. Therefore, current situation won’t be sustainable.

Long Products

Last Saturday average price of rebar was USD 445/mt, which reached USD 436/mt by Wednesday. Average price of I-beam size 14 to 18 in Isfahan was USD 520/mt , which reached USD 500 /mt including VAT by Wednesday. The main reason for the decrease in prices is the control of prices at IME and forcing all mills to supply their rebar at up to the maximum price set by IME. Traditional lack of demand in Holy Month of Ramadan has also made market more quiet.

Flat Products

HRC thickness 2 mm was USD 561/mt on last Saturday, which reached around USD 568 /mt by the end of the week. HRC thickness of 3 to 15 mm were priced at an average of USD 645 /mt on Saturday, which reached USD 627/mt on Wednesday.

Oxin co HRP price dropped from USD 749/mt to USD 727/mt by end of the week. Supply level of the mill didn’t change but demand level declined more and made prices downward.

On last Saturday, CRC thickness 0.40 to 2.5 mm was USD 941/mt, which increased to USD 968/mt by Wednesday. The relative improvement in the price of this commodity at IME is due to the limited supply, not the improvement in demand, because its demand remains in shortage, especially in the home appliance sector.

HDG price decreased from the average of USD 908/mt to USD 906/mt during last week in Iran due to lower HRC price.

CBI weekly average ex-rate for Steel Products (SANA): Rials 140.901 / 1USD

04 May 2020

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May 4, 2020 14:38
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