Following the recent amendments in Iran’s export policy, namely the reduction of the export tariff for billet to two percent, Iranian steel mills have returned to active offerings of steel billet to overseas customers. However, aiming to slow the pace of price declines, this week some suppliers have opted to delay the deadlines for the ongoing tenders.
Accordingly, since last week, Iranian exporters have floated around 135,000 mt of steel billet within the scope of export tenders. The material is for delivery in the middle of June-beginning of July. Although the deadlines for some tenders were indicated for May 15-17, none of them appears to have been closed yet. In particular, having received a bid at $568/mt FOB, an Iranian steel mill has continued to conduct negotiations with a customer, aiming to get a higher price. Meanwhile, another steel mill has postponed a deadline for a tender up to May 29, also looking forward to securing an order at a higher price. Nevertheless, such developments remain quite doubtful, given the bearish sentiments in the global steel market. “Mills believe that power shortages and lower supply from Iran could push prices upwards. However, I believe that, as long as demand does not pick up in China, prices cannot increase,” a market source stated.
Meanwhile, an offer for a distressed ex-Iran steel billet cargo from China has failed to attract any interest among buyers in Thailand at $650/mt CFR. This could be an additional proof that buyers believe that prices have not reached any bottom yet.
Given the absence of fresh transactions but taking into account lower bids, SteelOrbis’ assessment for ex-Iran steel billet has declined by $10/mt over the past week to $580-590/mt FOB.