Two of the leading Iranian steel producers have lately closed export tenders for steel billet, following a long break in trading. However, the prices are considered a little on the high side, especially taking into account the low workable levels in Asia and the potential risks in selling to the UAE.
According to sources, Khouzestan Steel Company (KSC) has traded 30,000 mt of billet for January delivery at $452/mt FOB, while Esfahan Steel Company (ESCO) states it has sold a similar volume at $455/mt FOB. Some sources have reported even slightly higher price levels, which are hardly considered workable.
In Asia, which is one of the main markets for Iranian billet, the latest workable price level for billet traded inside the region has settled at $450-470/mt CFR, which makes the latest ex-Iran prices unworkable. In the GCC, the delivered price of $485-490/mt CFR matches the abovementioned FOB-based sales. However, there is a potential threat from the new certification system due to take effect soon, designed to specifically track the origin of billet. As a result, Oman may maintain its incoming flow of Iranian billet, while UAE-based buyers may choose to delay purchases and wait and see, SteelOrbis understands.
