Even as countries world over begin to take notice of the growing steel exports from Iran, with some even imposing or contemplating anti dumping duties, the middle-eastern power house continues to fire up production and increase international sales exponentially.Raising eyebrows in countries still recovering from the flood of Chinese steel, the oil rich Nation has set out on an ambitious pursuit to double its steel export in the next couple of years and reach 25 million tonnes (mnt) by year 2025.
The present government in the energy rich Nation is determined to break its dependence on oil exports to fuel the economy. Presently almost 80 % of the country’s foreign exchange comes from Oil. Authorities wanting to change this ratio soon, look to capitalize on Steel and catalyze a
tectonic shift in the economy.
Iran’s per capita steel consumption has dipped almost by 7 % since 2013 whereas its production has increased by 16 % during the same time. Statistics clearly indicate an export oriented push in production of steel and specifically semi finished products. Producers in Iran shipped 5.53 MnT of steel last year, an increase of over 40 %. This comprised of 3.74 MnT of semi finished products which was up 108 % year-on-year.
Soon after international sanctions were lifted, the once internationally alienated Nation has done well to reestablish trade in the Middle East and scale new frontier in the present fiscal the steel industry which is mostly dominated by state run plants has churned out record output of 6.369 MnT steel in the first three months which is 14% more than the previous year. Iran’s capacity utilization is presently at round 62% as opposed to the world average of 73%. If exports from Iran strengthen the capacity utilization is sure to go up in addition to expansion of plants.
The clear reason behind this multi fold growth in Iran’s steel export is the competitive pricing of its products which is at products which is at least USD 10 cheaper than Indian or Chinese steel. Many countries have seen this as a threat th their local production with Thailand already imposing definitive anti dumping duty on flat products from Iran. However, Exports of semi finished products continue to be strong. Reports suggested that even the European Union had brought Iranian steel under scrutiny and was contemplating action before withdrawing from the move at the last moment.
Political dynamics in the Middle East have changed dramatically over the past few weeks as key decision makers in Saudi Arabia and United Arab Emirates imposed sanctions on Qatar. Iran has been one of Qatar’s strongest allies and may be at the receiving end of some ire from Middle Eastern powers. The Political changes are expected to have some short term implications on Iran however the country is actively seeking new consumers for its goods and making efforts to go beyond its traditional markets.
Source : Steel 360 July’17 Issue
TOPICS TO BE DISCUSSED AT
2nd Steel Prices International Conference
Parsian Esteghlal International Hotel,
Chamran Hwy, Tehran, Iran
- Access to low-cost energy in the form of natural gas and electricity
- Fairly low-cost iron ore mines
- Convenient locations for exports
- Attractive capacity expansions via direct-reduced iron and electric arc furnace methods
- Government support for the industry
- Iran is set to be Major Exporter of Semi Finished and Finished Product as steel producers set an export target of 15 MnT by 2022 and 8 MnT in 2018
- Iran is likely to become the largest DRI producer and exporter in near future