Iran's apparent steel usage registered a decline in the first seven months of the current Iranian year (March 21-Oct. 22) compared with last year's corresponding period.
Apparent steel usage is defined as production plus imports minus exports, sometimes also adjusted for changes in inventories.
The apparent usage totaled 9.57 million tons for finished products, posting a 12% decrease year-on-year, according to the Iranian Steel Producers Association.
Long steel products accounted for the largest portion of finished steel consumption with 4.85 million tons, down 12% YOY.
Rebar grabbed the biggest share in this section with 3.85 million tons, down 14% YOY, followed by beams with 613,000 tons (down 7% YOY) and L-beam, T-beam and other types with 391,000 tons (up 1% compared with the same period of last fiscal year).
Flat steel products accounted for 4.71 million tons of finished steel apparent usage, down 13% YOY.
Among flat steel products, hot-rolled coil had the biggest share of apparent usage with 4.45 million tons (down 15% YOY), followed by cold-rolled coil with 1.6 million tons (down 5% YOY) and coated coil with 816,000 tons (down 3% compared with the same period of last year).
The apparent usage stood at 11.72 million tons for semi-finished products, registering a 19% decline compared with last year's corresponding period.
The apparent usage of billet and bloom amounted to 6.61 million tons, down 23% compared with the same period of last year. The use of slab also decreased by 15% to 6.11 million tons during the first seven months of the year.
DRI usage declined by 7% to 16.68 million tons, during the period under review.
Output Hit by Power Restrictions
The ISPA data show a marked decline in domestic steelmakers’ production during the period under review.
Iranian steelmakers produced a total of 15.77 million tons of semi-finished products during the seven months to Oct. 22, down 11% year-on-year.
According to ISPA, billet and bloom made up 9.33 million tons of total semi-finished production, down 15% YOY.
Slab output reached 6.44 million tons to register a 5% decline year-on-year.
The output of finished steel decreased by 8% YOY to 11.03 million tons.
Long steel products had a 6.29 million-ton share in the output of finished steel products, posting a 3% decline compared with the similar period of last year.
Rebar production stood at 5.14 million tons (down 3% YOY). It was followed by beams with 697,000 tons (down 9% YOY) and L-beam, T-beam and other types with 469,000 tons (unchanged from the corresponding period of last year).
Production of flat steel with 4.74 million tons registered a 13% YOY decline in the seven-month period.
Hot-rolled coil made up 4.66 million tons of the production in this category, showing a 12% YOY decline, followed by cold-rolled coil with 1.41 million tons, down 12% YOY; and coated coil with 860,000 down 5% compared with last year’s corresponding period.
Iran's output of direct reduced iron stood at 17.38 million tons during the period under review down 4% YOY.
The decline in steel output is due to the power outages and restrictions imposed on steelmakers in summer.
Losses of Steel Mills
In a letter to the Supreme National Security Council, ISPA has put steel mills’ losses due to power outages at $6 billion from the beginning of the current Iranian year (March 21) to Sept. 12.
According to ISPA, 82 complete days of production were lost during the period due to power outages and 300,000 direct and indirect jobs were lost or restricted, the news portal of the association reported.
Summer demand led to severe power and water shortage in summer in most regions, resulting in blackouts and dry taps.
Electricity consumption on June 20 surpassed 62,000 MW.
The new record came, as high temperatures nationwide drove general electricity consumption to new heights, prompting authorities to prioritize domestic users over industries in supplying power.
As the manufacture of steel and cement is an energy-intensive process, their factories were restricted by the Iran Power Generation, Distribution and Transmission Company (locally known as Tavanir) and have been only allowed to work at a fraction of their capacity within specified hours.
The abrupt ban on the two key sectors created shortages of steel and cement in local markets and prices increased overnight, creating new problems for most construction sectors.
According to Tavanir Spokesman Mostafa Rajabi Mashhadi, all power restrictions on industries were removed as of Sept. 23.
Appreciating the good cooperation of steel industry this summer, he announced the end of electricity supply restrictions to the industry.
“This summer, a series of challenges such as unprecedented drought made it difficult to provide sustainable electricity to all subscribers, so given the priority of electricity supply to households and the public sectors, we were forced to impose restrictions on the industrial sector,” he was quoted as saying by ISNA.
Decline in Imports, Rise in Exports
Imports of finished steel decreased by 1% YOY to 479,000 tons during the same period.
The imports mostly included HRC with 84,000 tons, down 53%; CRC with 204,000 tons, up 66%; coated coil with 137,000 tons, up 2%; L-beam, T-beam and other types with 26,000 tons, up 8% YOY; rebar with 19,000 tons, up 27% and beam with 9,000 tons, up 29%.
Semi-finished steel imports made up 3,000 tons of the total import volume, down 25% YOY.
Iran imported 1,000 tons of billet and bloom in the period, down 67% YOY. Slab imports stood at 2,000 tons, up 100% from last year's same period.
Iran did not import DRI during the above-mentioned period.
Iranian steelmakers have achieved significant growth in exports, latest data released by the Iranian Steel Producers Association show.
A total of 4.06 million tons of semi-finished steel products were exported from Iran in the current fiscal year’s first seven months (March 21-Oct. 22), up 27% compared with the previous year’s similar period.
Billet and bloom had the lion’s share of semis exports with an aggregate of 2.72 million tons, 11% higher than the previous corresponding period.
Slab exports amounted to 1.34 million tons during the period, up 80% year-on-year.
Exports of finished steel products grew by 38% to 1.86 million tons during the seven months.
Rebar accounted for the largest portion of finished steel products exported from Iran during the period, with 1.31 million tons. The total volume of Iran’s rebar exports experienced a 57% growth compared with the same period of last year.
Beam exports amounted to 75,000 tons during the period under review, down 21% YOY.
About 104,000 tons of L-beam, T-beam and other types were also exported from Iran during the period, unchanged from the corresponding period last year.
Hot-rolled coil exports amounted to 291,000 tons, registering a 24% growth compared with the year before.
Cold-rolled coil with 11,000 tons registered a 56% decline and coated coil with 67,000 tons, up 29% year-on-year were the other finished steel products exported from Iran.
Exports of direct-reduced iron increased by 279% YOY to 698,000 tons, ISPA figures show.
DRI, also known as sponge iron, is produced from the direct reduction of iron ore in the form of lumps, pellets or fines by a reducing gas. It can be processed to create wrought iron.
Iran and India are the world’s biggest producer of DRI.
