Iran floats another billet export tender, currency trade rules may tighten trade

Tuesday, 05 March 2024 14:23:36 (GMT+3)   |   Istanbul
       

Iranian billet producers remain moderately active in export destinations, while a new tender has been floated lately. However, the export trade restriction has been adjusted in a relatively positive way. There is talk in the market about the government aiming to intervene in exporters’ currency trade, which, if it happens, will have a negative impact on overseas trade.

Iran’s Chadormalu Mining and Industrial Company has floated a tender for 30,000 mt of 150 mm 3SP/5SP billet, validity until March 12. The expected price in the tender is around $490-495/mt FOB, while the most recent sales, closed by Esfahan Steel Company, were reported at $507/mt and $510/mt FOB.

In addition, adjusting the export duty from two percent to one percent for semi-finished and placing a zero sales tax for the same product category has brought some optimism to the sector. However, some sources report that the Iranian government is mulling adjusting some currency trade rules for exporters. “The Iranian government wants all mills to return dollars at the official exchange rate, which may cut export volumes considerably,” a trader told SteelOrbis. The regulation is expected to come into force from the new Iranian year, but there is strong resistance from the steel producers’ side. The official exchange rate is IRR 42,000 against the US dollar, while the free rate is around IRR 60,000-61,000 to the dollar, which obviously makes a big difference for exporters.


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