Iran’s HRC imports surge strongly in Q1 Iranian year

Iran imported about 396,000 mt of hot rolled coil in the first quarter of the current Iranian year (started March 21, 2009), according to the Iranian customs authorities. This would be equivalent to 1.6 million mt for the whole of the year, 37 percent higher than the volume of around 1.170 million mt of hot rolled coil for the previous Iranian year. Naturally such a high volume of imports will lead to a strong buildup of inventory in the local market and will consequently prevent local prices from rising higher than international price levels.
 
Iranian state-owned steelmaker Mobarakeh Steel Co. produced about 5.1 million mt of hot rolled coil in the last Iranian year (ended March 20, 2009), up on the previous year's level. However, as Mobarakeh uses one part of its hot rolled coil output as feedstock for its cold rolled production and as another part of its hot rolled coil output is exported, Mobarakeh does not supply more than 3.0-3.5 million mt per year of hot rolled coil to the local market. Iran usually imports its shortfall of hot rolled coil from Russia, Ukraine, Kazakhstan and sometimes from China.
 
The Iranian domestic hot rolled coil market is currently experiencing some fluctuations, with prices tending to decline. 2-6 mm thick hot rolled coil is now standing at a price level of $580-650/mt ex-stock Tehran, down $15-20 week on week. The thicker hot rolled coil sizes (8-15 mm) are currently in a range of $620-650/mt ex-stock Tehran, also marking a reduction compared with the last few weeks.
 
On July 21, Mobarakeh, the main supplier of flat products in Iran, sold 2-8 mm hot rolled coil at $487-532/mt ex-works with 90-day delivery and for cash payment via the Iran Mercantile Exchange (IME) - the last sales by Mobarakeh to the local market. While in recent weeks Mobarakeh has not changed its sales price for the local market, market prices have been experiencing some fluctuations in the last few weeks.