The observation of the domestic steel market shows a dramatic increase in the prices of steel sections, which has been unprecedented in the winter until today. This increase in prices is by no means predictable and has surprised many speculators in the iron and steel market. In the current situation, the final consumer is under the greatest price pressure for many reasons, and this is not good news for the housing market at all. This sharp rise in prices is a serious warning for the housing market. Please stay with Artan Press until the end of this analysis.
*** Sparks for the increase in the price of long sections originated from the base rate of ingots
All the events and sparks of the increase in the price of long sections have originated from the base rate of ingots. Today, in a situation where the base rate of Bloom ingots in tomorrow’s commodity exchange transactions, like the base price of sheets in today’s transactions, was determined based on the 80% coefficient of the CIS region with the figure of 12 thousand and 771 Tomans, including VAT, and it is predicted that this trend The base price of rebar will be determined in Wednesday’s trading with a price of about 14,250 Tomans, we are witnessing the beginning of a new wave of high prices of steel sections in the open market.
It has been said before that the pricing of steel ingots with the new dollar exchange rate of the Iranian steel market will be accompanied by high prices, but unfortunately this opinion was not given a price. Now, if the factors of increasing the dollar exchange rate to the issue Add What logarithmic function can calculate the growth rate of sections in the market?
*** Increase in the price of ribbed rebar
At the moment, we are seeing a rise in the dollar, and news of Fordow uranium enrichment is likely to lead to a rise in the dollar. Despite the slow growth of the 50 dollar rate in the open market and reaching the figure of 25,750 tomans, while the selling rate of the dollar banknote on the national exchange board has been set at 50,720 tomans with an increase of 50 tomans, the price is higher. Types of ribbed rebars have increased between 100 to 400 and sometimes up to 600 Tomans compared to the previous day.
The steel market is in a situation where the slightest change in the exchange rate causes heavy fluctuations in the pricing of upstream steel chain products. Meanwhile, some steel industry experts attribute the decline in the quality of Iran’s long steel sections due to the increase in the price of raw materials needed by rollers and the increased use of induction ingots instead of kiln ingots as a factor to reduce exports of these sections this year.
*** Factor of high cost of steel sections of the country
Another issue that has been discussed about the high cost of the country’s steel sections is the high cost of raw materials for rolling products, which is a factor for higher prices of these products in the domestic market compared to world prices in a month. Analysts believe that this has prevented rollers from exporting their products at competitive prices in recent months.
But Dr. Keyvan Jafari’s opinion about the quality of long production sections is in this issue that can be cited. According to this steel analyst, long sections of Iranian production are of good quality and the issue of declining quality of the country’s steel products, especially long sections, is a false news that has been done on social networks and in this regard, witness a virtual narrative about broken rebar. We were in a bending machine that was claimed to belong to the Isfahan Steel Factory; Meanwhile, steel products have always had one of the highest production qualities of the country’s steel industry.
Therefore, the issue of high prices has not penetrated the quality of products, especially long sections of Iran, and has remained in the first chain. It seems that the Mining Industry and Trade Organization should think of measures to implement the new methodology correctly and in principle. By implementing the method in its current form, we are witnessing the growth of more prices and the elimination of many micro-actors in the steel industry.
*** Quality of long steel sections
Another issue that can be rooted in recent high prices is the issue of quality. It is true that in the current situation, the quality of steel products in the country is acceptable, but there is no proper mechanism to evaluate the quality of long steel sections in the country.
*** China’s experience in the production of steel sections
In the current situation, we must learn from the Chinese quality experience in the production of steel sections and follow the example. China, the world’s largest steel producer, currently has 247 blast furnace factories, and most of the country’s steel industry output is from this type of plant, which previously accounted for 90% of China’s output and 10%. The percentage also produced electric arc and induction furnaces, although this statistic belongs to before 2017, and gradually, as we went further, the rules in this regard became stricter.
If we examine the reason for this austerity, we find that the Chinese climate worsened and the Chinese government put pressure on some Chinese induction plants with a production capacity of 150 million tons to shut down between 2017 and 2019, and The reason was the import of scrap to produce their steel products, which reduces the quality of the product.
*** Rising beam prices
Observation of the domestic market in the current situation shows that from the issue of quality, we must pay attention to the heavy prices of steel sections. The price of beams has increased by 100 tomans in one day, which is very thought-provoking. Also, the first hearings from Tehran companies indicate the growth of 10 to 20 thousand Tomans in each branch of high-consumption sizes of molten beams.
Due to 21% competition to buy hot rolled sheets in today’s trading The commodity exchange, despite the 18% increase in the base price of this product, whether we like it today or tomorrow, we will probably see an acceleration in the growth of the prices of pipes and profiles in the open market; Because, unfortunately, these days, stock prices and methods are more effective in increasing prices than the market recession and the lack of customers.
*** New prices for steel products
Iran’s steel market has moved towards convergence with the international market in a situation where the market does not have this level of change. The growing global trend of steel prices and its impact on the domestic market has caused the price of ingots and steel products in the country’s commodity exchange and free market to increase in recent weeks and new price records have been set in this market again.
This price increase occurred in the country’s ingots and steel products market a few weeks ago when the Minister of Industry, Mines and Trade announced the implementation of the government’s steel policy as a way to control the steel market and reduce the price of long steel sections to less than 10,000 tomans. Unfortunately, this trend has not continued and the new methodology has taken a somewhat distorted path in pricing.
*** Determining the price of goods based on the cost rate
Meanwhile, some people want to determine the price of goods based on the cost price and consider tying the price of supply of each product in the country’s commodity exchange to world prices as a factor of high prices in the market. But based on modern science and experience, it has been proven many times in the country that even determining the price of a product based on the finished price can not cause a product to reach the final consumer at the same announced price. Such a decision-making process is only an opportunity to distribute rents and create windfall wealth for certain people.
It seems that under the pressure of public opinion and parliament in the recent rising prices in the domestic steel market; Government steelmakers have worked to reduce some of these pressures by increasing supply, even at the previous base rate; Of course, there is another issue among some activists, and that is the discussion of blocking some stock exchange codes this week due to tax problems and the application of some legal strictures, which turns this situation into a golden opportunity for strong stock exchange clients. More; Because the competitive environment is somewhat softened by removing a number of stock exchange codes and they can compete in a space with a small number of competitors; Make the most of Saturday’s opportunity.
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