Iranian market: HRC and CRC see sharp drops while HDG moves up

The Iranian flat products market has experienced a situation of sharp decline since 12.04.2007. The flat products market, just like long products, saw an unexpected rising trend after the Iranian New Year holiday (21.03.2007 - 03.04.2007). This upward trend started on 03.04.2007, when the market reopened, and continued 20 days until 11.04.2007. The following day the market entered a downward trend which has lasted up to the present.
 
After the New Year holiday, the Iranian flats producers, especially Mobarakeh Steel Co (MSC) followed the market trend and increased its prices for flat products by about $100/mt. However, Mobarakeh Steel Co. along with others is unable to meet the market demand. Furthermore, MSC is also facing high demand in other neighboring and European countries because of the high quality of its products. MSC usually allocates a major part of its capacity for export and this naturally influences the local market. During the last Iranian year, MSC exported about one million mt of flat products, while it has a capacity of 4.2 million tons at present. Of course, the shortage of flat products is usually compensated by lower quality products imported from the CIS or, more recently, from China. Now, however imports are also in a bad situation as US sanctions and UN resolutions targeting Iranian nuclear projects are creating more difficulties for foreign businesses and for imports. Nowadays, Iranian pipe and profile manufacturers are suffering shortages of hot rolled coil since Mobarakeh cannot meet their needs, while it is also more difficult than in the past for them to import from other countries due to banking and financial sanctions.  
 
The current market price situation:
 
Hot rolled coil/sheet which stood at $750-850/mt on 09.04.2007 has already dropped by about $35-40, now at a level of $715-810/mt.
 
Cold rolled coil/sheet which was at $800-860/mt on 09.04.2007 has gone down by about $50/mt and is now at a level of $750-812/mt.
 
HDG, which is at a high level of $1,000-1,200/mt, has not only not decreased but has also increased by about $75/mt for sizes of 0.70-1.25  mm. Price for sizes of 0.70- 1.25 mm were  $1,000/mt on 09.04.2007, reaching $1,075/mt at present. The prices of other sizes have not much shown change, remaining at the same level of 09.04.2007 ($1,100 -1,200/mt). 
 
It is difficult to expect further price reductions while global and local trends move in the opposite direction. However, we may observe some temporary fluctuations as in recent days. However, these will just be temporary with prices expected to follow a general uprising trend.