EghtesadOnline: Major Iranian steelmakers exported 1.27 million tons of semi-finished and finished steel products during the first two months of the current fiscal year (March 21-May 21) to register a 25% growth year-on-year, according to data released by Iranian Mines and Mining Industries Development and Renovation Organization.
The companies shipped 858,974 tons of steel during the second month of the year (April 21-May 21), which indicates a 36% YOY rise following an unpromising performance during the month before.
The data used here are preliminary statistics offered by IMIDRO on Iran's top-scale producers and lacks details on most private producers' shipments.
A more complete report is usually published by Iran Steel Producers Association a few weeks later, according to Financial Tribune.
> Khouzestan Steel Remains on Top
Khouzestan Steel Company exported 491,282 tons of slab, bloom and billet last month, registering a 7% growth YOY, to remain the biggest Iranian steel exporter.
Slab exports had the lion’s share of KSC's exports with 209,774 tons, going up 26% YOY. Bloom exports came next with 148,527 tons down 42% YOY, followed by billet with 132,981 tons, surging 253% YOY.
The steelmaker, located in the southwestern Khuzestan Province, exports to over a dozen countries. About half of the exports goes to the Middle East and North Africa region. Other major export destinations are located in the Far East and Americas.
KSC exported a record high of 2.76 million tons in the last fiscal year (March 2017-18), growing 34% YOY.
> Mobarakeh's HRC Exports Surge
Mobarakeh Steel Company boosted exports in the second month of the year and ended the period as Iran's second largest steel exporter.
MSC shipped 241,910 tons of hot- and cold-rolled, acid-washed, tin-plated, coated, checkered and galvanized flat steel during the two-month period, indicating an overall YOY growth of 73%.
Hot-rolled coil shipments had the highest YOY growth with 1,718% to 98,964 tons. Coated coil was next with 486% uptick to 293 tons.
The giant steelmaker was last year's second largest exporter with 1.29 million tons, down 16% compared to the year before last.
Together with its subsidiaries, MSC is the largest flat producer in the Middle East and North Africa region, accounting for 1% of Iran’s GDP.
> ESCO Retreats to Third Spot
Esfahan Steel Company was the third biggest exporter during the period with 193,700 tons of beam, rebar, coils and other products shipped overseas, up 46% YOY.
The veteran steelmaker was Iran's second largest exporter in the month before last, as it overtook the underperforming MSC.
Rebar made up 33,266 tons of ESCO’s overall exports last month, dropping 20% YOY. It was followed by beam and coil with 18,693 tons and 8,261 tons respectively. Beam shipments were down 20% YOY, while coil exports grew 1%. Steel products listed as "other" made up 133,480 tons of all the exports, up 125% YOY.
ESCO ended last year with an 80% uptick in exports to 1.15 million tons, making it the third largest exporter.
> Other Producers
South Kaveh Steel Company came next with 184,000 tons of billets direct-reduced iron to post a 79% YOY surge in shipments.
Hormozgan Steel Company took the next rank with 115,628 tons of slabs shipped, down 22% YOY.
Khorasan Steel Company was next with 26,935 tons of rebar exported, down 9% YOY.
Iran Alloy Steel Company followed with 20,930 tons of rebar shipments, down 26% YOY.
Khouzestan Oxin Steel Company was next with 5,533 tons of plates, up 170% YOY.
Global Slab Exports Lose Edge Over Impending Sanctions
The beginning of June was marked by reduced availability of steel slabs in the global market. Despite this, forecasts for price trends were mixed, taking into account the different factors influencing the various regional markets.
The impending reintroduction of US trading sanctions against Iran are likely to cause many buyers to avoid trying to buy Iranian slabs, even though they are typically priced lower than similar material from other origins, Metal Bulletin reported.
“Asian importers will need to book costlier non-Iranian materials and many will probably try to buy more CIS slab,” a major South Korea-based trader said.
Asia’s import prices might rise as a result, the trader added.
Ukrainian steelmaker Metinvest is already trying to exploit this opportunity, offering its July-rolling slab to Asian customers at $565 per ton CFR.
“We hope to achieve sales at this price because demand for the product is high, while volumes are limited,” a company source said.
Metinvest itself had reduced volumes available because of furnace repairs, the source explained, and there was less material available generally in Asian region because customers have begun to refrain from dealings with Iran
In late May, offers of slab from the Alchevsk Steel Mill in eastern Ukraine, which is currently under the control of pro-Russia rebels, were also heard at $565 per ton CFR, but sources reported no update on purchase negotiations.
Last month, Southeast Asia’s and East Asia’s slab prices were at a standstill, largely due to low buying interest amid weak local downstream sales.
Few transactions were reported in May due to a persistently wide gap between bids and offers, although offer levels were falling slightly.
Indonesian buyers also refrained from importing materials because the country’s rupiah was weakening, which made imports more expensive. The currency was trading at 100,000 rupiah to $7.20 on June 6, compared with 100,000 rupiah to $7.17 on May 6.
Participants expect the Asian slab market to remain quiet, at least until the end of the Islamic month of Ramadan around June 15. Price expectations are mixed.
One producer source believes that the Indonesian market will “bounce back” and that buying will start again in mid- to late-June, after Eid Al-Fitr celebrations mark the end of Ramadan.
The lack of trading activity in recent weeks has made it difficult to predict price directions for this month, sources said.
“But I’m quite certain prices will fall in June, because there’s been very little movement in the market recently. Also, Indonesian buyers are already targeting lower prices of $520-530 per ton CFR for bookings [of slab imports] to be made in July,” one producer source said.
Re-rollers are still facing difficulties in achieving their domestic sales targets for downstream flat steel products such as hot-rolled coil, a trader in Indonesia said.
“Most HRC buyers are holding off from buying, so re-rollers will hope for slab prices to be much lower than the latest bookings [at $560 per ton CFR],” the trader said.