Economy, Business And Markets

Steel Production Up 7%

Steel Production Up 7%Steel Production Up 7%

The Iranian Association of Steel Producers said the country’s steel production rose by 7% in the first half of the current Iranian calendar year compared to the same period last year, reported Fooladnews.

The country produced 8.35 million metric tons of crude steel during the (latest) period, said Bahram Sobhani on Tuesday, adding that the growth is considered the highest among steel-producing countries, while the average global production growth rate in the industry is 3.5%.

During the first half of the year, the country also exported 1.1 million tons of steel products, showing a 4% rise compared to the similar six-month period last year.

However, the import of crude steel dropped by 74%, suggesting that domestic steel producers mainly relied on Iranian crude steel rather than importing it from countries such as China, Russia, and Ukraine.

Sobhani, who was speaking in a press meeting, urged the country’s decision-makers to adopt appropriate policies to counter China’s discounted steel products.

Many countries, including Turkey, have started to impose tariffs on Chinese crude steel in order to protect their domestic steel production, noted Sobhani, the head of the association.

The ministry of industry, mine, and trade recently unveiled its plan to push the industry sector out of stagnation, and market analysts say the impact of the move is already showing. Meanwhile, steel experts say the administration is expected to offer incentives to steel industry including export facilitation as well as subsidies for export.

Currently, one of the challenges ahead of the country’s steel manufacturing sector is the imbalance in the production chain, where steel plants are in short supply of raw material such as iron ore pellets and iron ore concentrate.

The country, according to industry minister, is in dire need of at least 6 million tons of iron ore pellets per year. The shortcoming is blamed on downstream sector’s deficiency in providing raw materials. The crisis has forced iron ore mines to export a large proportion of their iron ore.

Industry and steel officials say by launching numerous steel plants and iron ore concentrate and iron ore pellets manufacturing units, the country will not have to export raw material over the next two years.

Iran is trying hard to keep up with its 2025 Vision Plan, which states the country should produce 55 million tons of crude steel by the next eleven years. The exact current steel production rate has been debated, though it ranges somewhere between 15 and 18 million tons per year.