Iran: Domestic Billet Price Remains Stable Owing to Volatile Exchange Rates

Iran one of the largest exporter of billet has exported 875,000 MT billets and blooms during the first two months of current Persian year (21 Mar-21May’18). At the same time the nation is facing a haste in IRR exchange rates against USD. In free market USD is traded at around IRR 78,000 to 79,000 against the government fixed rate of IRR 42,560 against 1 USD. High exchange rate has affected the demand in domestic market.

1 – By considering the exchange rate fixed by Central Bank of Iran as IRR 42,560 against 1 USD, the market opened on 17-Jun’18 after EID holidays and billet was traded at around IRR 28,530-28,540/KG (USD 671/MT).

2 – During the mid of week billet prices were hovering at around IRR 28,120-28,320/KG (USD 661-665/MT).

3 – Towards the end of week billet prices were noted to be around IRR 28,230/KG (USD 663/MT).

As per Planner “Still the demand is under the haste for changing IRR to other currencies or commodities. No real demand has been seen. Besides, it is better for producers to sell domestically than export and the sell USD on the basis of ICB rate. So, it is all speculative”.

As per IRsteel “According to downward trend of long products and its market sadness, billet price in retail market declined. Generally, market trend is not clear due to many issues such as lower export level in near future and rising domestic supply.”

Prices in IRR/KG
Source: Planner

Demand for Rebar was Stable during the period, it was traded at around IRR 32,170/KG (USD 756/MT) to IRR 32,520/KG (USD 764/MT) whereas on the other hand scrap was traded at around IRR 20,030/KG (USD 471/MT) to IRR 20,300/KG (USD 477/MT).

Inputs taken from Planner and Irsteel