In the days after the three-day holiday and with the opening of the market on Monday, we are witnessing an irrational growth and increase in rising steel prices in the Iranian iron and steel market. This issue slightly contradicts the frameworks of previous years in the run-up to the elections. In the following, we will evaluate this issue and the possibility of stabilizing prices in the vicinity of prices. Please be with Artan Press.
*** Rising steel prices in the shadow of the Commodity Exchange election atmosphere
The upward trend in the prices of various steel products on Tuesday this week continues as before. This price increase was in a situation where yesterday, even with the decrease of about 350 thousand Tomans in the dollar rate and its entry into the range of 23 thousand and 600 Tomans, the sellers resisted the decrease in the price of steel sections and the increased rate stabilized in most products on Sunday this week. In some cases, we saw prices rise. With this trend, the price of rebar was somewhat stabilized yesterday, but the products of some companies saw an increase of 50 and 100 Tomans per kilogram. The corner and stud market also experienced a growth of 100 to 230 Tomans in prices, and only the price of a company’s stud products remained stable.
*** Consolidation of the trend of rising steel prices in the commodity exchange
In the beam market on Tuesday, although the prices witnessed an increase of 50 and 200 Tomans per kilogram, but the types of branch beams were offered without price change. The growth of steel prices has entered a worrying phase in the current situation. By continuing this trend, steel imports will definitely be cost-effective for the consumer.
The price fluctuation of steel products is while some consider the high rate of discovery of some items in the commodity exchange as the cause of this increase, so that according to the final statistics of yesterday’s transactions of different types of Mobarakeh steel sheets in the Commodity Exchange industrial hall, the rate discovered this week is HR The company reached 211 thousand and 742 Rials, which was 4.5% higher than the discovered rate of the previous supply of this product. According to these trades, the highest increase in the discovered rate compared to the previous supply was related to tin-plated sheet with a growth of 9.41%, which increased its trading rate to 298,578 Rials this week.
*** Steel market deviates from the logical path
Iran’s steel market has deviated from its logical path. We are in a situation where no consumer is going to buy. Sometimes in the stock market we see the purity of goods between producers. Continuation of this trend will pose a serious challenge to the housing market. The growth of steel prices this week and after the mid-June holidays has no justification in terms of supply and demand parameters. The sharp rise in the domestic selling price of steel is due to two factors: the “high and unrealistic price of the dollar” and the “rising global price of steel.” The high and unrealistic price of the dollar, although it brings huge rent benefits to industrial and mineral producers, but exacerbates the recession and high prices by having a direct impact on the increase in the price of goods from food to cars and buildings.
*** rising steel prices in all commodity groups
In this regard, the increase in steel prices is worrying, starting from the raw materials market and moving to the upstream basket of steel. We have observed the market in a situation where the price of rebar, beams and angles has grown significantly at the same time. There can be no logical reasons for this. For example, it is enough to look at rebar transactions in recent days.
Ribbed rebar market, affected by ingot trading on commodity exchanges; And following the upward trend and announcements of the roof dwellers of this market; Along with the price increase, it has been around 50 to 250 Tomans, which is far from the current pricing mechanisms. In the current situation, the health of supply and demand can not be promoted. This is very similar to the story of the Qits on the stock exchange in July last year. Continuation of this process will be to the detriment of the consumer.
Ingots play a key role in raising domestic steel prices
The rise in steel prices has only one reason. This issue should be strictly observed through the ingot path. The price of bullion in recent days, due to the psychological atmosphere of the election and the growth of the price of the dollar in the last days of the government, has caused the market atmosphere to appear chaotic. Where the same ingot does not have a buyer in the market with much lower prices, how is it that it is sold in the commodity exchange? It seems that the steel market problem is rooted in ingot trading. If this Achilles heel is removed, we will see an improvement in the expansion of steel markets. Otherwise, we will see a sharp increase in steel prices. The Iranian steel market has the potential for any uncertainty due to the duplication created in it.
*** Leading the steel market to the outside of the commodity exchange trading ring
It seems that the scenario created in the upward trend of Bloom ingot supply rates in the commodity exchange and transactions has been done; Most of it has been done with some pre-arrangements on the demand side and outside the commodity exchange. Therefore, the criterion for the health of supply and demand of the commodity exchange can not be considered. In fact, this issue can be an important factor in the high price of steel and iron in recent days. Therefore, the inflammatory aspect of this issue is more than the facilitator aspect of the issue. Because of the number of active people in the market, there are ways to circumvent the health of supply and demand. Therefore, at the present time, the market can not be controlled with classical approaches to economics. Unfortunately, rising global prices have also provided an opportunity for further inflammation of the domestic steel market.
*** Price growth in a sluggish market without a customer
Yesterday, after the return of the dollar rate to the channel of 23,000 Tomans, although the sharp increase in the price of these products was slower and the increased rate of most of these items stabilized, but the price of some steel sections was still rising. Expensive steel prices due to the items listed
It will most likely hit the market by the end of the week. This price fluctuation is in a situation where nothing special has happened in the supply and demand of steel sections and union activists continue to report the continuation of the recession in the non-customer market of steel products. With this trend, trade unions consider factors involved in fluctuations in the prices of steel sections that, like the market of other intermediate goods and capital affected by the country’s economic conditions, especially the influx of stray capital and stimulate profitability of some suppliers, intermediaries and brokers.
*** The role of the dollar in raising domestic steel prices
On Tuesday, the price of the dollar re-entered the channel of 24,000 Tomans. This was an excuse to push the price of dollar market inflammation back into the commodity exchange. Due to the increase in steel and iron prices in recent days, we have witnessed price movements in the steel and iron markets. This caused the price of each kilogram of rebar in the open market to increase by 1,200 tomans from 13,800 to 15,000 tomans.
Of course, the corner and stud market was relatively stable and the price per kilogram of these items increased by an average of 50 to 100 Tomans. Also, the profile market was relatively calm, unlike other steel sections; But the peak of the dollar increase in the price of steel products in the market of various types of beams was and the best-selling branches of this product grew by 10 to 100 thousand Tomans. According to the latest Metal Bulletin report, the price of Iran’s export ingots was in the range of $ 640 to $ 690, and the trend of increasing the price of steel products in the country’s market was not in line with global markets.
*** rising steel prices and warnings to manufacturers
The big steelmakers also have to pull the teeth of greed from the domestic market. They must be extremely sensitive to the fact that the domestic price of steel in the commodity exchange does not exceed the export rates with the half dollar balance and be themselves careful. The high price of steel and iron can be of some benefit to the producer.
From one place to another, by increasing the cost of raw materials, the smoke will go to the eyes of the manufacturer. Because this type of inflammation and this type of trading and the advance of commodity exchange transactions in stimulating market prices and its distance from market floor rates; Undoubtedly, it will have consequences. Finally, its smoke is due to some extravagances, with the intervention of surveillance sticks and repression that may again fall on this market from the supervisory pillars of the government and the system; It will be visible to all elements of the supply chain.
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