Iran: Steel billet export market less active amid supply concerns due to gas restrictions

Iran's billet export market remained less active this week amidst news of gas restrictions imposed on a few mills. No firm deals for exports have been recorded so far amidst limited offers in the market.

Low buying interest in key importing nations post-New Year has also weighed on the billet export market as market participants are yet to return from holidays. However, the hike in scrap offers has kept prices supported, SteelMint notes.

"Currently, no export tenders have been opened from our side due to gas limitations, we have a shortage of billets," an Iranian source said.

The latest assessment of Iran's billets (3SP) export prices stood at around $500/tonne (t) FOB on 3 January, up by around $25/t, w-o-w.

Semi-finished steel exports stable y-o-y in Mar-Dec'22

Iran's semi-finished steel exports (billet/bloom/slab) in the first nine months of the current Persian year (March-December, 2022) totalled 5.18 million tonnes (mnt), stable, y-o-y.

Domestic billets, rebars prices fall

Iran's domestic billets and rebars prices saw a sharp fall due to the government's current policy of controlling currency rates. However, market participants expect prices to trend up again, sources informed.

Outlook

Iran's semi-finished steel export prices are expected to remain supported because of the rise in global scrap prices and the country facing a severe energy shortage. However, a reduction in gas supplies during harsh winter in the region may result in a decline in production levels which is likely to affect billet export allocations.