Iran: Steel billet export market silent even as prices inch down

Iran's billet export market remained silent this week with prices falling slightly w-o-w. Limited trades dragged down billet export prices, SteelMint notes.

Also, economic activities in Iran are getting hampered pending political negotiations called the Joint Comprehensive Plan of Action (JCPOA), sources informed SteelMint.

Meanwhile, Sirjan Jahan Steel Company (SJSCO) floated an export tender for 30,000 t of steel billets with the due date being 30 August. The shipment is likely to be scheduled for October.

SteelMint's latest assessment of Iran's billet (3SP) export prices stood at around $456/t FOB on 23 August, a marginal decrease of around $4/t, w-o-w.

Exports down, production up in March-July

Iran's billet and bloom exports in the first four months of the current Persian year (March-July) registered a marginal 8% fall y-o-y to 1.55 mnt, while production stood at 6.28 mnt in the period under review, up 9% y-o-y, according to data released by the Iranian Steel Producers Association (ISPA).

Domestic trades on IME fall w-o-w

Domestic billet sales on the Iran Mercantile Exchange (IME) fell sharply by 89% w-o-w. However, the average sales price witnessed a slight decrease of just 1%.

Around 10,700 t of billets were traded on IME in the week under review at an average sales price of 127,236 Rial. Last week, about 96,200 t of billet were traded at an average sales price of 129,044 Rial.

Outlook

Amid power supply curbs, Iran's steel production is likely to remain limited in the near term, affecting billet export allocations. Futures trade-related activities also depend on the results of current political negotiations. However, after the Iranian government announced ease in restrictions, mills were seen offering billet for exports quite actively.