Answer :
Sponge iron deficiency and scrap iron
But how about?
The country's steel supply chain is generally divided into two groups or two groups:
(A) Constant Production Chain (A):
Production Process :
Pellets and ores >> Sponge iron (1%) and scrap (1%) >> Arc ingots >> Finished product
All three of these products are zero-to-100 produced by themselves and are largely self-sufficient; they are supported by the government and play an active role in the export of all three primary, intermediate and final products.
B) Private Production Chain (B):
Production Process :
Sponge Iron (1%) and Scrap Iron (1%) >> Arc Induction >> Finished Product
Private induction and smelting have to buy sponge iron and scrap iron; they are not sponge iron producers; they must buy sponge iron from manufacturer A, while chain A either exports or converts into bullion and The finished product does not want to be sold to the private sector. Rolling chain manufacturers have to buy their own ingots, and they are not mainly producing their own ingots; induction ingots; from private iron smelting; They provide induction.
And what about the problem?
Manufacturer of raw materials or sponge iron A chain; these days he is reluctant to serve the producer of inductive or fused B chain chains; either converts himself to bullion or exports, since his activity in the export, It brings the currency back to the government, the government backs it, and so the producer of mainly inductive B-chain bulls faces a crisis of supply of raw materials, and because of the scarcity of raw materials and the rising price of sponge iron, the bullion is expensive; B-chain roller bearers, driven by high pressures and expensive bullets, are forced to condemn their product price increases in succession. Again.
And this is how we see the private sector (B) rebar prices rise in the market while the downturn is in the consumption market, and of course, the supply chain (A) also has no major problem supplying its raw materials; It distributes itself and the consumer needs through the commodity exchange, but in the meantime takes advantage of the excitement and pressure created in the B chain. Because the excitement in the market will increase the competitive rate of exchange on the stock market, which will bring profits to the fortune producer and ultimately to the satisfaction of their shareholders and the government.
Where is the red line in the rise in private sector supply chain (B)?
Usually, the product's trading rate in export markets can be a reliable and reasonable amount for the end-user and the domestic consumer, provided that the product is unlike non-proprietary steel sheets or beams and is abundantly available on the domestic supply side; The case for the exported ribbed rebar in Iran, considering the dollar rate and the rate of about $ 2 per ton (factory door delivery) these days will be equivalent to 1 Toman which will be about 8 Tomans in value added tax for the domestic consumer. Now, assuming exports are denominated in dollars, this figure is It can be expanded for up to 5 tomans, but it does not export more and only has domestic demand and market dominance to justify domestic customer purchases.
For this reason, the rate of end product for some rollers is that due to the pressure from the top and from the ingot, it has largely lost its operational capability and attractiveness in Iranian border export markets and is confined to domestic consumption and activity in the region. Or the province where the private producer (B) is located.
Describe the main reasons for the increase in rebar prices in the Iranian market and in a recession