Iranian HDG market still on downward slope

Hot dip galvanized coil prices have been declining rapidly in the local Iranian market since the middle of May. Iranian galvanizing mills are offering 0.5-1.25 mm HDG at about Rials 9.10-9.50 million (about $867-905/mt) per metric ton ex-works (including three percent VAT), down from about $970-980/mt around two weeks ago and from $990-1,000/mt at the start of May.
 
HDG prices have been decreasing in the last few weeks in the local Iranian market affected by the global downtrend in flats prices and weak domestic demand. In addition, competition between local Iranian suppliers of HDG has further intensified the falling trend in the market. Most Iranian galvanizing mills have made downward adjustments to their official prices in the last few weeks, while some of them are also selling material at less than their listed prices. Mobarakeh Steel, Seven Diamonds Industries, Kashan Amirkabir Galvanizing, Semnan Rolling & Tube and Royandood are some of the main suppliers of HDG coil in Iran, with a total nominal capacity of about 900,000-1,000,000 mt per year.
 
Local market leader Mobarakeh has not sold any HDG in the current week, influenced by the current declining trend. Mobarakeh's HDG usually costs about $10-15/mt more than material from other suppliers in the local market. Iranian traders generally import HDG from Russian and Kazakhstan due to ease of shipment via the Caspian Sea; however, Iran has not imported so much HDG in recent years. Iran imported about 225,000 mt of HDG in the last Iranian year (ended March 20).