Iranian billet export prices spike by $25-30/t

Iranian billet prices jumped by around $30, in a deal concluded at the end of last week. A leading Iranian steel exporter, Khouzestan Steel Company (KSC), sold 30,000 t billets to China at $620/t, FoB through a tender for June ’21 shipments. After this deal, the mills are now eyeing to achieve $625/t FoB Iran levels in their upcoming tenders. However, we didn’t witness any deals at this price level. SteelMint’s bi-weekly assessment for Iranian billets is $620-625/t, FoB, up by $20-25 against closing of last week.

Reasons for price surge- SteelMint’s view

• China’s slashing of import tariffs on semi-finished steel to 0% in order to boost imports
• China’s decision to adjust export tariffs on 146 steel commodities, including finished long.
• SHFE rebar futures surge
• Increasing global scrap prices

Deals and offers:

• ESCO floats 20,000 t billet export tender: A leading Iranian steel exporter, Esfahan Steel Company (ESCO), has floated an export for 20,000 t billets for June ’21 shipments. The tender is likely to be concluded in the coming week- SteelMint learned during conversations with a company official. In the previously concluded tender (during last week), the mill achieved a price level of $590/t, FoB Iran.
• On the other hand, Chadormalu’s official mentioned that they are planning to float the export tender in the coming week for 30,000 t (likely) billets. The company’s previous tender sold was at $599/t, FoB Iran, last week.

Iranian Steel Producers Association (ISPA) recently released steel export figures for the last Iranian fiscal ended on 20 Mar ’21. The key highlights are:

• Iranian mills exported around nine mn t steel, down by 13% y-o-y.
• Semi-finished steel exports stood at 6.1 mn t, down by 11% y-o-y. Billet & bloom exports fell by 6% y-o-y.
• Finished steel exports recorded at 2.83 mn t to register an 18% y-o-y decline.

Limited trades reported at IME against offered quantity: This week, approximately 52,000 t billets reported having traded against the offered quantity of 98,000 t. However, the domestic prices witnessed a marginal rise of IRR 730/kg ($3/t) to reach IRR 119,562/kg ($540/t). The domestic prices remained supported by higher export prices.