Due to softening US-origin scrap and Russian-origin billet import quotes in Turkey, reduced Chinese billet prices, and weak Thailand and Indonesian market dynamics, traders are preparing to lower bids for September-readiness billet tenders in Iran.

US-origin HMS 80:20 scrap is now at $355/tonne cfr Turkey, Russian billet offers to Turkey at $480/t cfr Iskenderun port, and Chinese 150mm 5sp grade billet to the Philippines at $515/t cfr. This will spur traders to bid lower in Iran’s billet tenders next week, Kallanish notes.

Two weeks ago, Iran’s sole blast furnace route long steel producer, ESCO, concluded a 30,000-tonne parcel 150mm 3sp billet tender at $483/t fob Iran for August shipment. This commitment became the ceiling quote, and buyers assume $475-480/t fob for the upcoming end-August/September-readiness billet tenders.

"Iranian mills will soon announce September-readiness billet tenders. In September, electricity supply will be eased in Iran. Consequently, production could surge; therefore, cargo availability would be more. Iran has a certain domestic consumption volume, so overcapacity should be shipped abroad," opines a reputable trader.

"Looking at the global trend for semis, a slight downward price correction is predicted. Demand is low in export markets, but some enquiries are always there. Upon the bids we receive, a workable Iranian billet price is $475-480/t fob for September readiness," he adds.