For a few weeks now the prices of hot rolled coil in the Iranian market have been stable while global prices have continued to soar every day. Hot rolled coils of 2-12 mm thickness are being transacted by local traders at prices of $1,010-1,070/mt ex-stock Tehran. As the main supplier of flat products in
Iran, Mobarakeh Steel Company's sales prices have a strong influence on the market. Mobarakeh has maintained its prices unchanged over recent weeks. On Monday this producer sold about 50,000 mt of hot rolled coils to local traders at $957/mt ex-works with 40-day delivery on the Tehran Mercantile Exchange. Ferro Gillan, a privately-owned rolling mill which also produces hot rolled coil by rolling imported
slab of
CIS origin, is now selling hot rolled coil of 8-16 mm thickness at $1,075/mt ex-works.
The
CIS countries usually offer the lowest steel prices for
Iran thanks to their proximity via the Caspian Sea, which provides an easy and economic way for shipment to
Iran at low
freight costs (about $20-30/mt). Russian suppliers recently offered hot rolled coil of 2-6 mm thickness at a price range of $1,100-1,120/mt CFR
Iran's Caspian Sea ports; meanwhile,
Ukraine's prices are about $40-50/mt higher than
Russia's as it has to dispatch its material to
Iran's main southern port of Bandar Abbas at a
freight cost of at least $80/mt. The price of Kazakh origin hot rolled coil is also near to that of the Russian suppliers.
The decision of the Iranian authorities to reduce the import duty on hot rolled coil from 10 to four percent could be counted as one of main factors contributing to the current stagnation in
Iran's hot rolled coil market, while Mobarakeh's artificially-low prices can also be said to be a contributing factor. However, most Iranian traders are now looking forward to a new rising trend in the local
flats market, especially following the soaring trend in
Iran's long products market which has been in evidence since the beginning of this week.