Iran is actively working over the balancing of steel production chain by expanding upstream segments to feed the future needs of the industry. Nevertheless, depending on the growth rate of steel output there are two scenarios of raw materials market development. In the first, the country will be self-sufficient in iron ore, while in the second it may turn to import, Metal Expert, a Ukraine-based provider of news and analysis on steel products and steelmaking raw material industries, wrote in a recent report dubbed “Iran in Focus”
Iran is aiming to increase annual steel output to 55 million tons by 2025. To source it the country will need 92 million tons of pellets or 90 million tons of concentrate or 159 million tons of iron ore, according to Iron Ore Producers and Exporters Association of Iran.
Under a positive scenario of 11% industrial growth rate, the country will be able to reach the abovementioned steel production target. In such conditions, concentrate and iron ore deficit is expected at 18 million tons and 43 million tons respectively taking into account the current mining and processing capacities and projects coming on stream soon.
The necessary volumes are planned to be imported. Among potential suppliers can be Kazakhstan and Afghanistan, Keyvan Jafari Tehrani, IROPEX member of the board and head of international affairs pointed out at the Metal Expert’s 2nd MENA Billet Import Conference, held in Dubai in April.
At the same time if the industry growth rate will remain at or near 8%, as it is now, the country’s steel output is expected to reach 36 million tons. In these conditions Iran will remain self-sufficient in raw materials.
Future developments, however, depend largely on the availability of local funding and foreign investment as well as the complete removal of sanctions, that still stops many international investors from cooperating with Iran. Another factor, which will be influencing the country’s steel output, is the situation both in the local and international markets in terms of demand and prices.
