Billet price had a
downward trend last week in Iran domestic market from USD 654/mt to USD 650/mt
ex-work including VAT, which was affected by the condition of rebar market, as
well as mental atmosphere of the market, which is expecting prices to fall at
IME (Iran Mercantile Exchange) due to global downward prices. What is
remarkable is the relationship between oil and billet price. Usually, one ton
of billet is equal to minimum 5 barrels and maximum 8 barrels of oil which today
this equality is at its minimum. Therefore, likelihood of further decline in
global prices seems weak.
Rebar prices fell a
little from USD 747/mt to USD 738/mt due to market expectations. This
expectation is so strong that less than 5% of the offered rebar at IME was being
traded. Of course, many mills take advantage of the market silence and announced
their supply level at IME more than their capability just to meet their commitment.
I-beam price has
reached the bottom and despite the fact that demand is limited, downward trend
in prices is not significant. It was down from USD 692/mt to USD 676/mt ex-work
Price of two mm
thickness HRC ex-work Mobarakeh was USD 985 /mt on last Saturday, which reached
USD 964 /mt by Wednesday. Mobarakeh Steel co supply trend has lowered prices,
but declining traders' profits and weak demand have kept prices low.
Oxin co HRP price in
spot market is very close to mill’s cost price. Most traders try to avoid
inventory of this product. This situation if continue will change prices.
Market average price changed from USD 1081/mt to USD 1071/mt.
CRC demand has
sharply decreased. Part of this is due to the beginning of the seasonal
recession of this product. On the other hand, the decline in car production has
also had a negative effect on demand of this product. Its price was down from
USD 1222/mt to USD 1208/mt.
Lower HRC price made
HDG market down from USD 1221/mt to USD 1208/mt.
Issues that are
keeping the market waiting include seasonal recession and market confusion, much of which is due to IME
and global market policies.
Factors that make
the market move are global market price trend, which seems to have reached its
bottom and will improve from recession with China opening. The second one is
issue of power cuts, which apparently has started. Third one is demand level,
which will show itself on base prices at IME when global prices stop declining.
If prices stop decreasing, warehouses will be activated and if the power cuts
become serious, it will stimulate more buying interest.
conflicting reports being heard from Nuclear Talks, but Russia's attack on
Ukraine seems to have multiplied the equation, so the market is not expected to
be affected by the nuclear talks in the near future unless something special
CBI weekly average ex-rate for Steel
Products (SANA): Rials 242,618 / 1USD
30 May 2022
Iran Steel News Bulletin