Competition among the rebar (reinforcing bar) producers to grab more market share has caused the prices to drop between 50 to 150 rials per kilogram in the steel market, Fooladnews reported Saturday.
The downward trend for steel products continued in the week ending to December 12, leading to an 11.25% decline in the prices of rebar during the past 7 months. The girders, both light and heavy, also experienced decrease in prices of 0.7% during the week.
During the week, the prices for structural sections, majority of imported steel products, steel angles, and steel channels were not subject to strong fluctuations. At the Iran Mercantile Exchange (IME), the Khuzestan Steel Company offered steel sections and slabs on steel trading floor on Wednesday, while Esfahan Steel Company offered heavy and light girders size 18 at 16,410 and 16,700 rials per kilogram, respectively, and in the form of forward contracts. The company also offered 583 metric tons of rebar grade A3 as forward contract in sizes 14 and 16 at the base price 17,000 rials.
Despite the relative profitability of metals’ future contracts, the cash offers have not been quite successful, as there were no demands for rebar bundles of size 14 to 28 offered by Khorasan Steel Company at 16,100 rials per kilogram. The trade of slabs was not tremendous since only 39,400 metric tons out of 50,000 metric tons offered at the IME was purchased.
Many experts in the steel market, according to the Persian daily Donya-e Eqtesad, believe that slab and ingot prices need to be revised to improve the trading of these two products. Experts also say the reason why the slab and ingot prices have not so far decreased is that slab is the main raw material used to produce steel plates and the plate manufacturers, who enjoy a better market in comparison with makers of other steel products, have to buy the slab at any price offered on the market so as to prevent the closure of their production lines.
