For a few weeks now CIS suppliers have been reducing their billet export prices for the Iranian market. The latest offers of CIS billet for the Iranian market stand in the range of $400-420/mt CFR Iran's Caspian Sea ports, for production in March and shipment in April. CIS suppliers were offering the same material at $415-430/mt the week before and at $425-445/mt two weeks ago.
Suppliers to the Iranian market have been having great difficulties in gaining orders in spite of their attempts to make their prices more attractive and more competitive (with prices now approaching rock bottom levels) and even though they have been willing to accept letters of credit from some Iranian Banks. The stagnation in the Iranian domestic billet market is so strong that customers are not enticed by such efforts on the part of the suppliers.
A few domestic privately-owned melt shops which have come on stream in recent years are currently supplying billet at $410-450/mt ex-works. Khouzestan Steel, the main state-owned supplier of billet, is now offering at $460-465/mt ex-works; however, the prices of both privately-owned and state-owned plants are negotiable and more competitive prices may be obtained for actual transactions.
Billets made up about 40 percent of steel imported into Iran during the last Iranian year (ended March 20, 2008) according to Iranian customs statistics. Iran imported more than four million mt of semis (mainly billets) in the last Iranian year, compared to around 2.95 million mt of semis during the first 10 months of the current Iranian year.