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The drop in long steel output is mainly the result of subdued demand in the construction sector.
The drop in long steel output is mainly the result of subdued demand in the construction sector.

Iran Steel Output Hits 30m Tons

“Billet and bloom” and hot-rolled coil have the largest share of semi-finished and finished steel output with 8.53 million and 5.75 million tons, indicating a 17% and 9% YOY growth respectively
Direct-reduced iron production stood at 16.53 million tons, indicating a 22% rise YOY

Iran Steel Output Hits 30m Tons

Iranian steelmakers produced 30 million tons of steel during the first nine months of the current fiscal year (March 21-Dec. 21) to register a 12.5% growth compared with last year’s corresponding period.
According to the latest statistics provided by Iran Steel Producers Association, semi-finished steel made up 16.07 million tons of the output, up 16% year-on-year.
"Billet and bloom" output stood at 8.53 million tons while that of slab reached 7.54 million tons, recording a 17% and 15% YOY growth respectively.
As for finished steel, the output increased 9% YOY to reach 14.63 million tons.
Finished steel production has followed a rising trend this year for all products, except for beam and rebar.
Hot-rolled coil had the lion’s share of finished steel production with 5.75 million tons, up 9% YOY; followed by rebar with 4.6 million tons, down 8% YOY; cold-rolled coil with 1.75 million tons, up 29% YOY; coated coil with 1.13 million tons, up 42% YOY; beams with 765,000 tons, down 2% YOY; and “other steel products” with 628,000 tons, up 133% YOY.
The drop in long steel output is mainly the result of subdued demand in the construction sector. Government spending on the sector is also forecast to decline in the next fiscal year (March 2018-19) due to slashed development allocations in the new budget bill.
Analysts believe the worsening local demand is encouraging steelmakers to capitalize on exports.
Iran’s direct-reduced iron production is also on the rise. It stood at 16.53 million tons during the nine-month period, indicating a 22% rise YOY. Semi-privatized steelmakers accounted for 11.75 million tons of the output and private mills for 4.78 million tons, with their YOY growth at 14% and 46% respectively.
Private steel producers are still no match for giant semi-privatized mills in terms of total production, but have consistently notched higher growth figures every month in the current fiscal year.
Semi-private mills produced 11.88 million tons of semis and 8.77 million tons of finished steel to mark an 11% and 4% uptick respectively YOY.
Private producers, on the other hand, jumped 34% in semi output and 18% in finished steel production to reach 4.18 million tons and 5.86 million tons respectively.
Major Iranian steelmakers have exported 5.11 million tons of semis and finished steel in the nine months, up 26% YOY, according to statistics released by the Iranian Mines and Mining Industries Development and Renovation Organization.
IMIDRO statistics show that the export volume for Azar, the ninth month of the Iranian year (Nov. 22-Dec. 21), stood at 529,348 tons, up 10% year-on-year.
Exports have been continuously on the rise this year month-on-month, except for Mehr and Ordibehesht, the seventh and second months of the Iranian year respectively.
Semi-finished steel exports have been particularly strong, as producers have embarked on aggressive capacity-making in the face of weaker domestic demand.
Notably, Esfahan Steel Company has shipped its first rebar cargo to the UK recently. The shipment of 5,000 tons at $505/ton FOB southern port is due to arrive in late January 2018.
Additional contracts are nearly finalized for the same destination, while another cargo is under negotiation for Scotland, a company source told S&P Global Platts. It is the first rebar cargo to be shipped to a European country from Iran.
ESCO is Iran's largest producer of long products and the only Iranian steel producer using blast furnaces. About 50% of the company's output were exported in the nine months under review to Belgium, the Netherlands, Sudan, Egypt, Thailand, Pakistan, Oman, the UAE and other Middle East states.
As the second biggest Iranian steel exporter during the period after Khouzestan Steel Company, ESCO shipped 805,434 tons of beam, rebar, coils and other products overseas, indicating a 87% rise YOY. Rebar made up 115,451 tons of ESCO’s overall exports, rising 6% YOY.
As part of the 20-year Vision Plan (2005-25), the Iranian steel industry aims to become the world’s sixth largest steelmaker by reaching an output capacity of 55 million tons per year by 2025. About 65% of the target are already realized.

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