Recently, Iran Mercantile Exchange has come up with a new policy of calculating the base price of billet. As per the policy, base price of billet will be calculated as CIS FoB price multiply by NIMA USD exchange rate multiply by 0.90. Owing to this policy, the domestic billet prices in domestic market soared up last week almost by USD 30/MT.
According to SteelMint assessment, during week 7 (09-14 Feb’19), Iran market was close four days due to national holidays. Market opened on 12 Feb’19, domestic billet offers were noted to be around IRR 40,610 /KG (USD 469/MT). Prices remained stable on next day. Towards the end of week, billet offers were noted to be around IRR 40,100 (USD 463/MT).
As per Planner, “Prices are hiking sharply due to new price policy by IME, also currency fluctuations has led to hike in price. Prices are also affected partly due to seasonal demand as well.”
IR Steel quoted, “Within last month billet price in global markets also has improved by around USD 80/MT which has made Iran billet export market more interesting and attractive as average billet export price has been USD 400-420/MT FoB Iranian ports. Higher export interest made domestic supply limited and DRI price rose to higher than USD 161/MT ex-work excluding 9% VAT within last week and is expected to be higher than USD 173/MT in coming days. This upward pressure reached pellet market too and is around USD 92 /MT ex-work excluding 9% VAT.”
| Commodities | 9/2/2019 | 10/2/2019 | 11/2/2019 | 12/2/2019 | 13/2/2019 | 14/2/2019 |
| Scrap | National Holiday | 30,410 | 30,800 | 31,230 | ||
| Billet | 40,610 | 40,600 | 40,100 | |||
| Rebar | 44,590 | 45,360 | 45,300 | |||
| Difference between Scrap-Billet | 10,200 | 9,800 | 8,870 | |||
| Difference between Billet-Rebar | 3,980 | 4,760 | 5,200 | |||
Unit: IRR/KG
Source: Planner
During last week, scrap offers in Iranian domestic market was noted to be around IRR 30,410 – 31,230/KG (USD 351-360/MT). Domestic rebar offers were ranged from IRR 44,590 – 45,360 /KG (USD 515-523/MT).
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