CIS suppliers again reduce billet prices for the Iranian market

CIS suppliers have again reduced their billet prices for export to Iran. They are currently offering 125 x 125 mm to 150 x 150 mm billet at $610-620/mt CFR Iranian northern ports for production in May and shipment in June, which is about $20-25/mt less than their offers in the early and middle part of March, and about $70-80/mt lower than their offers in January. Meanwhile, even lower prices from some CIS suppliers have also been reported.
 
The turmoil in the Middle East and North Africa (MENA) countries, which has caused a drop in the demand of these countries for billet, may be indicated as the main factor which has forced CIS suppliers to reduce their prices. Of course, there are some hopes that billet prices may recover when more Iranian buyers return to the market after Iran's New Year holidays. However, this does not seem to have happened yet. The turmoil in the MENA region exerts two opposing impacts on the global steel market; the increased price of oil natually can impact the production costs of steel, while slack demand in the countries in question can force suppliers to reduce their prices.
 
Local Iranian traders who import billet from the CIS have not changed their prices much in the last two to three weeks, despite the price reduction by CIS suppliers. Iranian traders are currently offering ready stock CIS billet of 125 x 125 mm to 150 x 150 mm sizes at about $630-650/mt ex-stock Iranian northern ports, down from $630-660/mt about four weeks ago and down from $650-690/mt about eight weeks ago. Ukranian origin ready stock 125 x 125 mm - 150 x 150 mm billet sizes are now at about $610-615/mt ex-stock Iranian southern ports, down from $610-620/mt about four weeks ago and down from $640-650/mt about eight weeks ago.
 
As revealed by the Iranian customs authorities, Iran imported about 4.5 million mt of semi-finished steel (mainly billet) in the last Iranian year (March 21, 2010-March 20, 2011).
 
US$1 = Rials 10,400