One reason for high import flat steel prices in Iran is increased cost of freight in the Caspian Sea basin sparked by a massive increase in grain shipments to the country, which has led to the lack of vessels.
The cost of freight from the Russian port of Astrakhan is $45-46 per ton, against a normal rate of $20 per ton. Transportation from Kazakhstan’s Aktau Port costs $30-31 per ton, against the typical rate of $15 per ton.
Metal Bulletin’s price assessment for imported 2 mm hot-rolled coil in Iran was $560-575 per ton CFR Iranian ports on Nov. 15, compared with $565-575 per ton CFR a week earlier, Financial Tribune reported.
Offers from Russian mills were reported coming in at €450 ($529) per ton FOB Astarkhan.
One cargo for end-January shipment was booked by a trader at the mentioned price. The tonnage was not disclosed.
Considering the current cost of freight from the port to Iranian northern port Anzali of $45-46 per ton, which would be equivalent to $574-575 per ton CFR.
Some sources, however, considered that a discount of around €10 per ton could be achieved, had the tonnage been big enough.
Recent bookings for Kazakhstan-origin material were reported at $535 per ton FOB Aktau, or $565 per ton CFR Anzali, considering $30 per ton freight cost between the two ports.
The price assessment for imported cold-rolled coil in Iran narrowed to $605-620 per ton CFR Iranian ports on Wednesday, against $600-626 per ton a week earlier.
Kazakhstan-origin CRC was available in the market at $570 per ton FOB Aktau, or $600 per ton FOB Anzali.
However, the price was considered too high by customers.
“[The price of $600 per ton CFR] is too expensive, considering that in the local Iranian market you can buy the material at $550-560 EXW,” one trader said.
Russia-origin CRC was said to be available at €490 per ton FOB Astarkhan.
In the coated steel segment, the situation was the same, with customers preferring domestic material because of more competitive prices.
China-origin hot-dipped galvanized coil with 1 mm thickness was available in Iran at $695 per ton CFR, sources said.
Considering the 26% import duty, 9% VAT tax and 3% transportation costs, this would be equivalent to $959 per ton.
In the domestic market, the material of similar thickness is available at $880 per ton EXW.
Therefore, sources said workable price for import HDG coil should not exceed $640 per ton CFR.
Metal Bulletin’s weekly price assessment for import HDG coil in Iran was $640-695 per ton CFR, falling by $15 on the lower end from the previous range of $655-695 per ton CFR.