I-beam prices are soaring in the Iranian market following the long closure of the market for the Iranian New Year holidays (20.03.2008-10.04.2008). I-beam sizes of 140-180 mm were in a price range of $1,015-1,052/mt ex-stock Tehran on Thursday,April 17. Of course, the I- beam market experienced some fluctuations during the current week especially due to some concerns originating from discussions among the Iranian authorities regarding the possible reduction of customs duty on finished steel products including I-beam. This product is already subject to a customs duty of 10 percent, but some groups in the government are trying to reduce it as they think such a decision could cause a fall in steel prices in the local market. However, most traders and experts think that any reduction of the customs duty would just cause a temporary shock in the market, but that the global upward trend in the steel market is so strong that the measure would be ineffective in blocking the soaring prices even for a short period.
Esfahan Steel Co. along with Iran National Steel Industrial Group, both state-owned enterprises, produced about 1.8-1.9 million mt of I-beam in the last Iranian year 1386 (21.03.2007-20.03.2008). The third main supplier of I-beam in Iran is the private-owned rolling mill Arian Steel, but its capacity and product size range is not very big. Construction works by the private sector of a few addition rolling mills capable of producing I-beam have not been completed yet. Meanwhile, according to data released by Iranian customs, Iran imported about 1.2 million mt of I-beam during the last Iranian year, mainly from the CIS countries, China and Eastern Europe.
The global price increases for steel, which have picked up speed since the beginning of 2008, along with the high local demand for I-beam from the large volume of construction projects in Iran, have together created a seller's market for I-beam as for other steel products. Nowadays, there is less and less time for negotiations between buyers and sellers as everybody knows that if a transaction is not finalized today then a higher price will be set tomorrow.