Iran Steel Exports: Semis Grow 80%, Finished Products Decline 29%

Iran’s semi-finished steel exports during the first nine months of the current fiscal year (March 21-Dec. 21) stood at 4.61 million tons, marking a rise of 80% year-on-year, the Iranian Steel Producers Association announced.

Billet and bloom had the largest share of exports in the semis sector, reaching 2.58 million tons to register a 52% rise YOY. Slab shipments followed, growing 134% YOY to 2.03 million tons.

Exports of finished steel products during the period, however, had a marked drop, shrinking by 29% YOY to 1.07 million tons. The figure shows an improvement compared to ISPA’s previous announcement that indicated a 35% drop during the eight months to Nov. 21.

Hot-rolled coil was the main exported commodity in this sector with 440,000 tons, dropping 59% YOY. The exports of less than 3-mm HRC exports, in contrast, jumped 4,300% YOY to 44,000 tons, while thicker materials were still down.

Rebar exports came next with 397,000 tons, followed by beams with 129,000 tons, “other steel products” with 56,000 tons, coated coil with 45,000 tons and cold-rolled coil with 8,000 tons.

Khouzestan Steel Company exported a record high of 1.94 million tons of slab, bloom and billet during the nine-month period, registering a 46% rise YOY, to remain the biggest Iranian steel exporter. Bloom exports had the lion’s share of KSC’s shipments with 861,726 tons, going up 150% YOY.

Officials expect steel exports to reach 8 million tons in the current fiscal year (ending March 20).

Exports of direct-reduced iron surged 392% YOY to reach 517,000 tons.

DRI production is also on the rise. It stood at 16.53 million tons for the nine months, posting a 22% rise YOY.

Iran has created considerable DRI capacities in the past few years, as it is committed to ensure its steelmakers’ feedstocks are sufficiently supplied to fulfill the industry’s 2025 industrial goal. As per the 20-Year Vision Plan, Iran is stipulated to reach an output capacity of 55 million tons of steel in seven years.

The ISPA report also shows imports were down for nearly all steel products. Semis imports shrank 79% YOY to 38,000 tons. Billet and bloom purchases dropped a hefty 88% YOY to 21,000 tons, while slab imports surged 639% to 17,000 tons.

Imports on the finished steel front also dropped 28% YOY to 1.65 million tons. CRC, rebar and coated coil imports all posted growth in imports.

ISPA statistics show that steelmakers produced 30 million tons of steel during the period, up 12.5%. Semis made up 16.07 million tons of the output, growing 16% YOY, and finished steel production rose 9% to 14.63 million tons.

Long steel output has shrunk nearly every month this year, primarily due to weakening 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 withering local demand is encouraging steelmakers to capitalize on exports.