Economy, Business And Markets

Private Sector Steel Output at 3m Tons

Private Sector Steel Output at 3m TonsPrivate Sector Steel Output at 3m Tons

Domestic steel producers in the private sector produced more than 3 million metric tons of crude steel and steel products during the first 7 months of the current Iranian calendar year (March 21-October 22), IRNA reported Monday.

During the seven-month period, 3.06 million metric tons of steel was produced by the private steelmakers. Reinforcing bars (rebar) accounted for around 60% of the total amount, or 1.87 million metric tons, followed by 1.11milion metric tons of steel ingots. Steel plates (647,500 metric tons or 21.1% of the total production during the period), girders (230,600 metric tons or 7.5%), and other steel products such as steel angles, hollow structural sections (HSS), and steel channels stood next.

The highest production rate in the period was recorded between August 23 and October 22, while the lowest was recorded in May. Foolad Mobarakeh, Khuzestan, and Esfahan steel companies accounted for the largest contributions to the seven-month steel production.

Total steel production during the past Iranian calendar year (ended March 20, 2014) exceeded 16.5 million metric tons, which indicated a 5% decrease compared to the previous year. But the production of crude steel, which stood at 15.6 million metric tons during the one-year period, suggested a 8.8% increase in comparison with the previous year.

Domestic steelmakers, who are expected to produce between 52 and 55 million metric tons of steel per annum by 2025, have recently raised the alarm over the import of cheap Chinese crude steel and steel products.

Iron ore prices are very low in China as the country has very low manufacturing costs and that is why the increase in China’s steel exports have caused problems for importing countries including Iran, said Bahram Sobhani, chairman of Iranian Steel Producers Association (ISPA).

Apart from concerted efforts by domestic producers to decrease production costs, they are also attempting to clear their overdue debts. Following the unprecedented stagnation in the domestic steel market during the past year, which put many steel manufacturing plants on the verge of closing, they have time and again called on the government to impose higher tariffs for imported steel, especially from China.

Steel manufacturers, who have been hit for two years ago by economic downturn in the housing sector, have held several meetings with officials at the ministry of industry, mine, and trade. During the meetings, proposals have been discussed regarding raising tariffs for imports. However, no specific figure for the tariffs has been agreed upon yet. The domestic steel manufacturers propose import tariffs of 25% for different types of girders, 35% for bundles of rebar, and up to 15% for billets and ingots.