Economy, Business And Markets

Gov’t Urged to Cut Steel Strip Products’ Import Duty

Gov’t Urged to Cut Steel Strip Products’ Import Duty
Gov’t Urged to Cut Steel Strip Products’ Import Duty

Mobarakeh Steel Company has asked the Iranian government to reduce the import duty on steel strip products by 25%, the company’s managing director said.

“To support downstream industries, MSC has suggested to the government to decrease the import duty for both hot and cold rolled coils to 15% from the current 20%,” Bahram Sobhani was also quoted as saying by S&P Global Platts.

“It is not clear for us when the new duty will be imposed or practical, but we believe that, as long as the country needs to import some materials, duties are an implement to regulate prices in the domestic market and should be reviewed from time to time, according to the requirements.”

One steel market player said the duty will be reduced soon as the price of strip products in the domestic market is currently above international prices and it will raise the cost of projects as well as production costs for downstream industries such as vehicles and pipe makers.

“The Iranian Syndicate of Steel Pipe and Profile Manufacturers believes a 5 percentage point cut would not be enough to secure the country’s supply,” syndicate secretary, Amirhossein Kaveh, said.

“The country’s demand clearly cannot be supplied by domestic producers completely and there is a shortage, which should be imported with a reasonable cost. We believe the import duty should be decreased to 5% and export should be limited by imposing an export duty on strip products.”

Iran has a highly protective policy toward its steel industry.

There is a 15% import duty in place on semi-finished products; 20-26% for flat products (excluding stainless steel) and 26% for most long products such as I-beams and H-beams.

Some 2.57 million tons of steel products were imported into Iran in the first seven months of the Iranian year (up to October 20), according to customs statistics, 3% up on last year.

Demand for flat products and alloy steel is expected to rise further as a result of the removal of sanctions and new projects in the oil, gas and petrochemicals sectors.

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