Iranian buyers of CIS billet have been coming back to the market after several weeks during which that they had suspended their purchases. The rising trend of billet and finished product prices, evident since the middle of January, has slowed down in the last few weeks. Last week, CIS suppliers were offering billet at $540-545/mt CFR Iranian northern ports for April/May production and June shipment. The market is still expecting new ex-CIS offers for the current week.
Iranian traders and rolling mills, which usually import billet from the CIS countries (mainly Russia and Ukraine) have recently placed some new orders for billet at about $530-540/mt CFR Iranian northern ports - a fair indication that the market is gradually coming to accept the raised prices of billet. Of course, some buyers still have doubts about the stability of these prices; however, most of the Iranian market has clearly understood that any price reduction is impossible at least in the near future and that there is no other option except to place new orders.
Local Iranian billet suppliers, mainly belonging to the private sector, have also hiked their prices following global developments in the billet markets, especially in relation to CIS export prices. Local Iranian producers are currently offering billet at $530-570/mt, depending on quality and size. Iranian billet suppliers already have a nominal capacity of over one million mt per year but they are so far unable to operate at full capacity as some of them are new and are still in the trial production stage, while others have been affected by financial restrictions.