Both this week and last week Esfahan Steel sold rebar at Rials 700-710 million per metric ton ex-works, for about 35-day delivery and cash payment, through the Iran Mercantile Exchange (IME). Today and also yesterday at the IME, some traders involved in importing Chinese and Turkish rebar have sold ready stock material at $610/mt and $630/mt respectively ex-Iranian southern ports.
In the past week CIS origin rebar has been offered at $490-510/mt CFR Iran's northern ports (mainly Anzali port), while Chinese rebar has been offered at a price higher than the CIS material. The import volume of rebar has fallen down strongly in recent months due to the heavy stagnation which has influenced both the local and global markets. Iran imported about 580,000 mt of rebar in the first eight months of the current Iranian year (i.e. in 21.03-20.11.2008), while it imported about 940,000 mt in the same period of last year - according to newly published statistics from the Iranian customs authorities.
When the market was flourishing in 2007 and in the first half of 2008, local rolling mills were unable to use more than 30-40 percent of their capacity due to the shortage of billet and financial restrictions. However, given the subsequent stagnation of the market and the weak levels of demand, the same rolling mills are now working at less than 30 percent of capacity. Meanwhile, billet prices have fallen down to one third of their peak level of a few months ago; billet prices exceeded $1,200/mt CFR Iranian ports in July, while at present they are down to a level of about $400/mt CFR Iranian northern ports.