Steel Market Clouded by Surplus
Economy, Business And Markets

Steel Market Clouded by Surplus

Sponge iron production surpassed expectations at 216,000 tons during the first quarter of the current Iranian year (March 21-June 21), creating a surplus of more than 10,000 tons in the domestic market.
The surplus production and absence of export markets have led to sponge iron being sold in the domestic markets at $20-$30 below the global price for scrap iron, said Asadollah Farshad, the managing director of Ghadir Iron and Steel Company, Foolad News reported.
He predicted a tough year ahead for domestic steel manufacturers, noting that they have been unable to export any of their products during the current year’s first quarter due to the decline in global steel prices.
“This is while during a similar period last year, more than 50,000 tons of steel products were exported to the Persian Gulf countries,” he said.
Farshad hoped that steel exports would pick up during the second half of the current Iranian year provided the government revives its infrastructural development projects.

  Low Demand for Steel Sheets
The domestic steel industry has been hit hard by an unprecedented downturn in construction activities and declining global prices.
So much so that even steel sheets, used for manufacturing a wide range of industrial products, are facing diminished demand.
Meanwhile, as domestic manufacturers are struggling to sell the piled up steel sheets in their storehouses, official data by Iran Customs Administration indicate a surge in import of steel sheets last Iranian year.
Import of hot-rolled sheets increased by 29% compared with the previous year, while 144% more cold-rolled sheets were imported during the period.
Although last year, the administration increased import tariff on flat steel products from 4% to 15%, the huge amount of imports were reportedly registered before the new tariffs were enacted.
It appears that a number of traders deliberately registered huge import orders prior to the imposition of the new import tariff to hoard the steel sheets, resulting in lower demand for domestic products.


Short URL : http://goo.gl/HSKGpu

You can also read ...

How China Became Iran’s Coziest Trade Partner?
From bilateral trade to finance contracts and civil projects,...
The economy of the Islamic Republic of Iran has been tied to political and foreign affairs developments over the years.
This is the Financial Tribune’s last edition of the current...
Iranian Banking Sector Awaits Full JCPOA Benefits
Iran’s Deputy Foreign Minister Abbas Araqchi addressed various...
President Hassan Rouhani on Sunday spoke to reporters after the last Cabinet meeting of the current year.
President Hassan Rouhani on Sunday outlined his administration...
Iran has more than 37 billion tons of proven mineral reserves and 57 billion tons of potential reserves.
Iran exported more than 58.09 million tons of mineral products...
All-Out Growth in Interbank Market
The Central Bank of Iran has released its latest data on the...