Oil price has been around
USD 80/ barrel; OPEC has held a meeting to reduce supply level by one million
tons to keep the price in the range of USD90/ barrel. Oil price trend has remained
confused for now. Goldman Sachs estimates three months ago was minimum USD63
and maximum USD110 a barrel. An increase in the price of oil means inflation,
which the West is fighting against, and a decrease in it price means an
increase in dollar rate. If oil goes up, billet price will go up; if it goes
down, exchange rate will stimulate higher exports from exporting countries.
supply is being limited due to cold weather, and this will increase its price. Price
fluctuations is only affected by the finished cost price, not supply and demand
On the demand side, market
will remain calm and naturally supply will decrease. Chinese market is on
Holidays and waiting for the Congress meeting and its policies, so the market
will not see any serious changes in the next two weeks.
In Iran domestic
market, rebar should remain stable because its supply is limited, but price of billet
will be faced with fluctuations of exchange rate with the increase in exports.
Of course, supply limitation will support prices. Mobarakeh Steel co will face
many problems in IME if it follows global market and lowers prices in the
domestic market. Therefore, the policy of a drastic price reduction cannot be
implemented. In general, according to the caution of the market operators, inventory
levels at warehouses will be kept at minimum and the determining factor will be
exchange market changes.
CBI weekly average ex-rate for Steel
Products (SANA): Rials 268,058 / 1USD
03 Oct 2022
Iran Steel News Bulletin