Iran Domestic Billet Prices Witness a Sharp Drop
Iranian domestic billet prices have witnessed an acute drop this week. The billet prices have fallen by IRR 8,800/kg, W-o-W. As a result of this event, the country’s finished steel prices are also witnessing the drop.
The event is a deliberate stunt of the Iranian government to control the prices, which were rising exponentially from the past few weeks amid blackouts caused by the shortage of natural gas. And hence, to avoid the material shortage, buyers were actively restocking the billets, which led to price rise.
The Iranian government is making all possible efforts to make Iranian Rial; IRR stronger against USD, to have better and controlled steel market dynamics. During conversation with Iran based source, SteelMint reliably learned that the country is soon going to implement INSTEX; Instrument in Support of Trade Exchanges, which is a mechanism to facilitate non-USD transactions and non-SWIFT, in order to avoid breaking of U.S sanctions. During Nov’19, five European Union nations; Belgium, Denmark, Netherlands, Finland, and Sweden have declared in a joint statement to join the INSTEX mechanism for trade with Iran. With INSTEX coming into the role, the European countries can trade with Iran unapologetically and unhesitantly. And eventually, this mechanism will make Iranian Rial; IRR. Stronger against USD.
As of 02 Mar’20, the Iranian domestic billet prices for 150*150mm and 3SP grade were at IRR 52,200/kg. The same was at IRR 61,000/kg, during last week.
Meanwhile, SteelMint’s assessment for billet export offers from Iran is at USD 390-395/MT, FoB Iran.
source: SteelMint
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