Iran: Steel billet export prices continue uptrend in recent deal

Iranian steel billet export prices continued to head north in a recently-concluded deal. A recovery in global scrap prices has kept billet export prices supported, SteelMint noted.

An Iranian mill concluded an export deal last week for 30,000 tonnes (t) of steel billets for shipment to the Gulf Cooperation Council (GCC) region at around $475/t FOB, sources informed SteelMint. Prices have corrected upwards by around $10/t as against the last concluded tender at the beginning of the previous week.

SteelMint's latest assessment of Iran's billet (3SP) export prices stood at around $470/t FOB on 20 December, up marginally by around $2/t, w-o-w.

Billet production up in Mar-Nov'22

Iran's billet and bloom production in the first eight months of the current Persian year (March-November, 2022) registered a significant 18% increase y-o-y to 12.83 mnt, according to the latest data released by the Iranian Steel Producers Association (ISPA).

The country's semi-finished steel production volumes continued to remain strong as electricity consumption restrictions were better managed this year as against the corresponding period last year (CPLY) due to the coordination between the Ministry of Energy and the steel association.

Domestic billet, rebar prices head north

Iran's domestic billet and rebar prices continued to see a sharp rise amid a shortage of electricity, and the scarcity of direct reduced iron (DRI) supply in the domestic market, sources informed SteelMint.

Outlook

Iran's semi-finished steel export prices are expected to remain supported in the near term because of the rise in global scrap prices and the country facing a severe energy shortage. However, a reduction in gas supply amid cold weather in the region may result in a drop in production levels as steel mills are ordered to reduce consumption by 30%, which may affect billet export allocations.