The Iranian billet market has experienced a noticeable slowdown, mainly due to reduced production caused by natural gas restrictions. The domestic market has been sluggish, and export prices remain unsatisfactory, especially with falling prices in the Far East.
Declining Export Prices
Earlier this week, Iranian billet traders observed prices for 150mm 3sp Chinese billets at $460-465/t CFR in their key export market of Indonesia. Indonesian steel mills, however, lowered their 150mm 3sp billet prices for late-February shipment to $460/t FOB. Additionally, ESCO and KSC completed 150mm 3sp billet deals last week at $457-458/t FOB and $455/t FOB, respectively, for January shipment, each involving 30,000-tonne orders. However, this week, billet suppliers are targeting $450-455/t FOB, a price that has failed to attract interest from buyers.
Challenges in Attracting Buyers
Potential buyers have expressed that Iranian billets at $450-455/t FOB are not attractive enough to generate transactions, with $440/t FOB considered the price point at which interest could arise. A trustworthy source remarked that, currently, 150mm 3sp Russian billets are priced at $445-450/t FOB, while Chinese billets are priced at $450/t FOB for February shipments. In this context, Iranian mills may need to lower their target prices to remain competitive, as $450-455/t FOB is struggling to find buyers in overseas markets.
Khorasan Steel’s Latest Tender
Meanwhile, Khorasan Steel has received bids for its latest billet export tender, which is expected to be finalized on Saturday. The competitive pricing and global market conditions will likely influence the final decision.
In summary, despite limited supply due to production curtailments in Iran, the low export prices are not sufficient to generate market activity, indicating a need for further price adjustments by Iranian steel mills.
