Ex-Iran billet prices up gradually in new deals, two percent export duty implemented again

Tuesday, 28 November 2023 16:01:36 (GMT+3)   |   Istanbul
       

Following the recent rises in scrap and ex-CIS billet prices, Iranian billet exporters have managed to slightly increase their prices in new deals. Overall sentiment has been positive in the international market, though it has been impacted by the recent news that the export duty for billets at two percent has been restored, from the previous 0.5 percent seen last year.

A deal for 30,000 mt of ex-Iran billet from the top supplier has been done at $472/mt FOB, while another similar tonnage from the other supplier has been traded at $470/mt FOB for December shipment. Last week, the top-tier producers were expecting $465-470/mt FOB, while a few smaller deals have been closed at $462-465/mt FOB.

As a result, the SteelOrbis reference price has come up from $462-470/mt FOB to $468-472/mt FOB.

“There are not many cheaper offers from Iran here [in Asia] now, as traders see the mills’ attempt to increase prices,” an Asian trader commented. The previous deal by a trader for ex-Iran billet was done at $505/mt CFR, while, with the current FOB deal prices, traders will target not below $510-515/mt CFR in Southeast Asia, which is still reasonable for buyers, who see higher offers for other origins, from the ASEAN region in particular.

The Iranian government has imposed a two percent export duty on semis again, according to a number of market sources. As SteelOrbis reported in July, Iran’s Ministry of Industry, Mining and Trade announced revised export duties for semi-finished steel, iron ore and sponge iron at two percent (up from 0.5 percent), at 20 percent (from also 0.5 percent) and at five percent respectively. But later this decision has been cancelled after a strong protest from local market players. It seems that a new round of tension will emerge in the Iranian market now, but for now Iranian mills will have to keep exporting semis taking the new duty into account.

In the last Iranian year (March 21, 2022 to March 20, 2023), Iran exported close to 7.4 million mt of semis, which is slightly below the previous year. Billet accounts for at least 70 percent of total semis exports from Iran, SteelOrbis estimates.


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