Last week, billet was being offered by CIS suppliers at $400-420/mt CFR Iranian northern ports for production in December and shipment in January 2009; however, most buyers still have expectations that prices will decline even further and this is why there is but faint demand for billet in the Iranian market. The billet prices in the local market for ready stock material and also the billet offers for new production - two months required for delivery - constitute the main criteria for the pricing of long products (rebar, angles, etc.) by local rolling mills in Iran. Almost all rolling mills are dependent on imported billet (mostly of CIS origin), and they consistently adjust their finished product prices depending on the trends observed in the prices of semi-finished material. Of course, locally produced billet is sold at a higher price than imported billet (at about $680-730/mt ex-works at present). However, local production material does not hold a large market share and, therefore, is unable to exert any strong influence on market prices.
Most privately-owned rolling mills in Iran have not yet cleared their stocks of high-priced billets. Some of them, however, who are in better financial circumstances, have placed small orders for billet in recent weeks. Nevertheless, with the current declining trend having continued since July, most buyers are still holding out for prices to hit rock bottom.
In the last Iranian year (21.03.2007-20.03.2008) Iran imported about 11 million mt of steel (all steel categories included), of which about 4.2 million mt consisted of billet. In the first half of the current Iranian year, Iran imported about 1.75 million mt of billet.