CIS suppliers are currently offering billet at around $420/mt CFR Iranian northern ports, up from the price range of $390-400/mt one week ago. However, no actual transaction has yet been recorded at this price level. Most local customers see this high billet price as an attempt to hike prices after a few weeks' absence on the part of the CIS suppliers. The Iranian market does not appear to be ready to accept such a high price at the current time.
Iranian traders are making bids for CIS billet at $400-410/mt and it is more likely that the CIS suppliers will accept such levels. It is obvious that the new CIS offers will be open to negotiation and will be reduced for any serious buyer. Meanwhile, a few days ago ready stock CIS billet was transacted at the Iran Mercantile Exchange at $380-390/mt ex-stock Iranian northern port, and prices a little higher than this can be found in the market.
Khouzestan Steel, which is Iran's main state-owned supplier of semi-finished steel, is currently offering billet at about $390-395/mt ex-works for immediate delivery and cash payment. Some small private sector suppliers are offering billet at a slightly higher price than this range. Given such levels, there is no doubt it is very difficult for CIS suppliers to book any orders at the prices mentioned previously.
Nowadays most customers for billet in Iran, consisting of local re-rollers and some traders, are out of the market as CIS prices are not so competitive. Local customers at the moment prefer to buy Iranian origin billet or ready stock CIS billet at the lower prices, for immediate delivery.
According to the data newly issued by the Iranian customs authorities, Iran imported more than 3.80 million mt of semis (mainly billet) in the last Iranian year (March 21, 2008-March 20, 2009), whereas it had imported 4.13 million mt in the previous year.