According to market reports, one of the leading steel producers in Iran has sold about 60,000 mt of billet in the export market at $340/mt FOB recently, which is down $5-10/mt compared to the previously announced offers. A large part of the volume (40,000 mt) has been sold to Thailand. Most market sources said that the initial level asked by exporters was too high in the current market conditions, taking into account the declines seen in the scrap market and lower ex-CIS billet prices.
SteelOrbis has learned that on CFR Thailand basis the above deal corresponds to $370/mt. This price level is $5-10/mt above a deal done to Thailand in mid-April. The recent contract was concluded mostly owing to hopes of some finished demand revival in June, sources have said. But in general, end-users in Southeast Asia evaluate $370/mt CFR as too high for them. “Offers for Iranian billets are around $370/mt CFR or just above it. But May is hopeless [in terms of finished steel demand] due to Covid-19 and the Eid holiday on May 24,” an Indonesian long steel producer said. “No buyers here at this price. It is impossible,” another importer in Indonesia told SteelOrbis.
There has been a lack of offers from traditional suppliers to Southeast Asia. Most of them have been asking for $375-380/mt CFR Southeast Asia. The prices are $5-10/mt above those to China, sources have said, due to higher freight to Southeast Asia and other specific adjustments. “Indian and CIS exporters all are selling to China,” a trader said.