Rebar prices have been climbing in the local Iranian market during the final days of the current Iranian year (ends March 20). Currently, 12-25 mm rebar sizes are being transacted by local traders at $550-570/mt ex-stock Tehran; the price of this material stood at $530-550/mt one week ago and at $540-560/mt two weeks ago. Meanwhile, CIS origin rebar is currently being offered by local traders ex-stock at northern or southern ports at $20-30/mt lower than the price of Iranian production rebar.
The Iranian government has issued new instructions that only Iranian production rebar is to be used in government projects. As a result, a major part of local demand has been diverted towards local producers, providing the main momentum for the new rising trend in the Iranian domestic rebar market.
On the other hand, the local steel market in Iran usually overheats in the last weeks of the Iranian year - most buyers prefer to place orders before the New Year holidays due to expectations of price increases at the beginning of every New Year. This year, however, only a moderate price rise has been registered by the local rebar and I-beam markets ahead of the New Year, while other long and flat products have not shown any indications of a price surge.
Most traders view the current rising trend in the local rebar market as just a temporary phenomenon and expect rebar prices to return again to their low levels after the holiday. Indeed, the new rising trend in the Iran's rebar and I-beam markets seems unlikely to survive more than a few days as all significant global and domestic pricing parameters indicate downward movement.