Iran: Steel Demand Likely to Fall Further Ahead of Winter Season

Iran, one of the largest billet exporter in MENA region has exported 1,806,000 MT billet and bloom during the first seven months of current Persian year (21-Mar till 22-Oct'18). The nation has witnessed a drop in export demand after the economic sanctions imposed by US. It is expected that demand for steel will reduce further due to winter seasons.

According to Mr. Mohammad Azad, Head of Tehran Iron and Steel Union, "Unfortunately in the next two months, steel producers will face a drop in exports, which will have a negative impact on their performance.

He added" Due to onset of the winter season, decline in demand has occurred in the market and this is causing problems to manufacturers by reducing their exports. When the demand is not good in the market, the manufacturers are forced to put their products in storage, but this does not mean hoarding the goods."

Pointing out to the need of government involvement, he said "the government should make a decisive decision to reform the domestic iron market, it should be noted that the demand should increase at the market level in order to boost the steel production sector. As the producer will not produce if he cannot sell his product on the domestic and foreign markets."

Iran: KSC Pushed Domestic Billet Offers in Iran

According to SteelMint's assessment, domestic bullet offer during week 47 (17 Nov - 22 Nov'18) had an upward trend. During the beginning of last week, domestic billet offers was noted to be around IRR 36,800/KG (USD 876/MT). During mid-week, KSC offered its billet at IME at USD 830/MT excluding 9% VAT which affected free market owing to which offers in free market went up to IRR 37,140/KG (USD 884/MT). Towards end of last week billet offers were noted to be around IRR 37,070 - 37,090/KG (USD 883/MT).

Units: IRR/KG
Source: Planner
1 USD = IRR 42,000

Inputs from Minews