The Iranian billet export market continued to remain quiet for yet another week. Increasing electricity issues in the country put a few billet tenders in negotiation mode and hence no firm conclusion in deals was reported.
Iran’s leading steel mills like KSC and ESCO had floated export tenders for two parcels of 30,000 t of billets (130mm) for end-Sept’21 shipments. However, Iranian steelmakers reported having received bids at around $620/tonne (t) FoB. Bids remained supported on the back of rising Chinese steel futures. According to data maintained with SteelMint, the Shanghai Futures Exchange (SHFE) rebar futures Oct’21 contract, on 15 Jul’21, closed at RMB 5,546/t ($858/t), up by RMB 153/t w-o-w.
In addition, Chadormalu had also floated an export tender for 30,000 t of billets but due to electricity issues, the tender hasn’t been concluded yet.
SteelMint’s bi-weekly export assessment for Iranian billets stood at $615-620/t FoB on 13 Jul’21.
Iran Power Generation, Distribution and Transmission Company has recently ordered steel and cement factories to reduce power consumption by 10% or else their electricity will be cut, sources reported SteelMint.
“Power cuts may continue to bother the Iranian steel industry till 20 Aug’21. This has lowered mills’ production. Apart from this, hot weather is another concern which has limited production,” a source from a leading steel mill told SteelMint.
Electricity issues have now started affecting the domestic market too. On the Iran Mercantile Exchange (IME), no trade has happened this week against around 89,600 t traded at an average price of 1,32,462 Rial last week. However, base price for billet has risen to 165,573 Rial this week.
Iran’s steel exports up 55% in Q1: Iran’s semi-finished exports during the first quarter of the current Islamic year (21 Mar-20 Jun’21) stood at 1.62 million tonnes (mn t), up by 55% y-o-y. Billets and blooms held the biggest share in semi-finished exports with an aggregate of 1.06 mn t, up 26% y-o-y. Exports of finished steel rose sharply by 125% y-o-y to 0.873 mn t.
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