Iran, one of the largest steel producer in MENA region has witnessed a downfall in domestic billet offers. Domestic billet offers has decreased almost by USD 30/MT in last week amid fall in the exchange rates and low demand from the finished long manufacturers.
According to SteelMint assessment, during the beginning of week 10 (02-07 Mar’19) domestic billet offers were noted to be around IRR 42,250/KG (USD 471/MT). Offers went down on the next day to IRR 41,940/KG (USD 468/MT). During mid of last week domestic offers of billet went down further to IRR 40,950/KG (USD 457/MT). Towards the end of last week offers were noted to be around IRR 40,600/KG (USD 453/MT).
As per Planner, “Government is interfering to control the prices even by force. There is a rumor in the market that the government wants to make the export conditional on domestic supply. Steelmakers have to supply certain quantity on IME and get export permission from the authorities.”
IR Steel quoted, “The most important reasons behind downward trend were falling exchange rates, falling demand from re-rollers and Lower long products prices. Approaching the end of the year has led billet manufacturer to try to deliver goods faster. The time limit for carriage of goods has accelerated this trend. Regardless of this, downward trend of China’s demand and its competition with Iranian exports products should not be ignored.”
| Commodities | 2/3/2019 | 3/3/2019 | 4/3/2019 | 5/3/2019 | 6/3/2019 | 7/3/2019 |
| Scrap | 32,060 | 32,190 | 32,300 | 32,250 | 31,800 | 31,470 |
| Billet | 42,250 | 41,940 | 41,250 | 40,950 | 40,650 | 40,600 |
| Rebar | 48,490 | 48,690 | 47,750 | 47,770 | 47,590 | 47,210 |
| Difference between Scrap-Billet | 10,190 | 9,750 | 8,950 | 8,700 | 8,850 | 9,130 |
| Difference between Billet-Rebar | 6,240 | 6,750 | 6,500 | 6,820 | 6,940 | 6,610 |
Unit: IRR/KG
Source: Planner
During last week, scrap offers in Iranian domestic market was noted to be around IRR 31,470 – 32,300/KG (USD 351-360/MT). Domestic rebar offers were ranged from IRR 47,210 – 48,690/KG (USD 527-543/MT).
Major Steel Mills Offered Billets in IME
A cargo of Khuzestan steel co billet was traded at USD 435 /MT base price excluding VAT, and size of 125 mm was traded at USD 404 /MT ex-work excluding VAT by a private factory, thus purchase thirst at IME dropped.
South Kaveh Steel offered and sold 10,000 MT billet in IME on 5 Mar’19 at IRR 38,369/KG (USD 428/MT) against the demand of 28,500 MT from buyer side.
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