Iran: Unavailability of Vessels Slow Down Billet Export Trades

Iran- one of the largest billet exporter in world has exported 1,266,000 MT billet and bloom during the first four months of current Persian year (21-Mar till 22-Jul’18). As per the data released by ISPA, export of billet during the period was reportedly up by 35% Y-o-Y against 939,000 MT during the same period of last Persian year.

But recently, due to US sanctions imposed on Iran has slowed down the exports leading to low demand of Iranian billet in the world. Billet FOB offers in Iran slide down to USD 460-470/MT, FoB during last week against the billet offer of USD 475-480/MT, FoB in preceding week.

Steel expert from Iran “Commodities” said that the main reason for decrease in export offers is due to unavailability of vessels to ship the cargo to GCC nations and Far East Asian countries which have remained major export destinations in past years. They added money remittance problem due to sanctions is also a major reason for decrease in the billet export from Iran.

Many of the shipping companies have quit their operations in Iran causing a fear in export market. Speaking about the future of Iranian billet export, Iran Steel Expert and Trader Mr Keyvan Jafari Tehrani said “2nd turn of US Sanctions will start from 4th Nov’18, which will restrict the freight and vessel transportation to and from Iran. Also it will affect banking and insurance sector due to which no bank and insurance companies will work with Iranian parties. This will make things worse and the export will become complicated.”

Global Billet & scrap market overview:

1. CIS billet export price assessment declined amid limited deals. Assessment stood at USD 470-475/MT, FoB Black Sea. However prices are likely to get supported amid rebound in global scrap prices.

2.  Chinese domestic billet prices have come down this week. Price assessment of Q235 billet 150*150 mm stood at RMB 4,060/MT (including VAT).

3.  Imported scrap prices in Turkey have moved up by around USD 10/MT W-o-W in Turkey.

4. Turkey billet export price assessment was around USD 475-480/MT, FoB.