Notwithstanding the prevailing uncertainties regarding the future price trend, Iranian steelmakers have continued to search for prices higher than those most customers are ready to accept. Moreover, some suppliers have continued to succeed in sales at their target prices.
Accordingly, while last week an Iranian steel exporter cancelled its billet tender due to low bids, namely $450/mt FOB BIK at the highest, SteelOrbis has learned that another Iran-based steel mill has managed to sell at $460/mt FOB BIK, which is more or less in the line of prices targeted by other Iranian steel exporters. “It is a high level indeed, though I still do not believe that it can be destined to China or Southeast Asia. It must be to the Gulf region,” a major market source stated. However, there are some suppliers, who have remained fairly optimistic regarding sales to China, in particular. “We anticipate a momentary rise, since the Chinese have some problems in power distribution,” a representative of an Iranian steel mill stated. Besides that, there are discussions in the market that another major Iranian mill is targeting $470/mt FOB BIK in its ongoing billet tender. The freight rate to the Gulf region is estimated at around $25/mt, while the freight to China assessed at around $35/mt.
Given all the information above, the SteelOrbis reference for ex-Iran steel billet has rebounded from $450-455/mt FOB to $460-470/mt FOB, with the high end of the range corresponding to the levels desired by mills, but not yet achieved in sales.