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Iran: Billets export prices likely to drop in awaited tender outcome

Iranian billets export prices have declined further on low bids and limited trade. Khouzestan Steel Company (KSC) floated steel billets and slab export tenders for 50,000...

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28 Apr 2022, 18:55 IST
Iran: Billets export prices likely to drop in awaited tender outcome

Iranian billets export prices have declined further on low bids and limited trade. Khouzestan Steel Company (KSC) floated steel billets and slab export tenders for 50,000 t each with the due date being 27 April 2022. The shipment is likely to be scheduled for June 2022. According to market sources, bids fetched for billets and slabs were around $650/t FOB and $665/t FOB, respectively which are lower compared to the bids received in the last tender. However, the confirmation of the tender conclusion could not be received till the time of publishing this report.

Meanwhile, another slab export tender for the sale of 20,000-30,000 t has been floated by Mobarakeh Steel Company (MSC) with the due date being 29 April 2022 and the shipment scheduled for end-June 2022.

SteelMint's latest assessment of Iran's billets (3SP) export prices stood at $670/t FOB on 27 April, down $7/t, w-o-w.

Export tariffs reduce

The Iranian Deputy Minister of Mines and Materials, in a letter to the ministry, announced the imposition of export tariffs on various products, including steel. In the case of steel billets, the export duty was set at 17% of the total product price. This move was initiated to discourage exports.

However, Iranian steel mills were opposing this move and were in continuous talks with the government for a grant of some relief.

In the latest update received on the same, the export duties were reduced yesterday in the latest announcement made by the Director-General of Mineral Industries. Export tariffs on billets have been lowered to 11% against the 17% announced earlier, while for slabs, the rates have been decreased to 17% from the previously-announced 22%.

Domestic billets, rebar prices fall

Iran's domestic billets and rebar prices witnessed a downtrend due to a fall in export prices and the absence of market participants before the Ramadan holidays.

Billets trade on IME fall by 17%

Domestic billets sales on the Iran Mercantile Exchange (IME) decreased by 17%. However, the average price was largely stable, w-o-w.

Around 50,700 t of billets were traded on IME in the week under review at an average sales price of 152,484 Rial. Last week, about 60,800 t of billets were traded at an average sales price of 152,583 Rial.

Outlook

With the recent reduction in export tariffs, Iranian mills are likely to turn active in exports in the coming week.

 

28 Apr 2022, 18:55 IST

 

 

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