- Weak market dynamics, power curbs impact exports
- Semi-finished steel production declines by 7% y-o-y
Iran’s semi-finished steel exports in the first eleven months of the current Persian year (21 March 2024-20 February 2025) stood at around 5.63 million tonnes (mnt), a decrease of 21% compared to the same period last year, according to data from Iranian Steel Producers Association (ISPA).
However, exports of long products were recorded at 3.23 mnt, up 13% y-o-y, while shipments of flats increased by 14% y-o-y to 494,000 tonnes (t).
As per sources, weak global market dynamics and electricity restrictions on Iranian steelmakers impacted production levels, ultimately limiting billet export allocations.
Meanwhile, exports of direct reduced iron (DRI) in the period under review were recorded at 1.59 mnt, a rise of around 14% y-o-y.
Semi-finished steel production falls 7% y-o-y
According to ISPA, Iran’s semi-finished steel output stood at 26.95 mnt in the first eleven months of the current Persian year, a decrease of 7% from 26.95 mnt in the same period last year. Production volumes declined due to the Iranian government’s power supply restrictions on steel mills, which were more stringent this year compared to the last.
Billets and blooms accounted for 16.49 mnt of total semis output, down by 8% compared to 18.01 mnt in the year-ago period.
Production of slabs inched down by 4% to 10.46 mnt as against 10.88 mnt in the corresponding period last year (CPLY).
Notably, DRI production stood at 31.36 mnt in the period under review, a slight decrease of 0.3% compared to 31.47 mnt in the year-ago period. Severe gas restrictions have hindered the commissioning of new sponge iron production capacities.
Finished steel imports rise 5% y-o-y
Iran’s finished steel imports in the first eleven months of the current Persian year stood at 1.39 mnt, a marginal increase of 5% compared to the same period of last year, according to data from the Iranian Steel Producers Association (ISPA).
Imports of long products were recorded at 94,000 t, down by 8% y-o-y, while those of flats increased 5% y-o-y to 1.29 mnt.
Outlook
Due to weak market demand, billet exporters are currently supplying less material, and this trend is expected to persist. Despite the Trade Development Organisation’s announcement that steel value chain exporters are no longer obligated to submit their export earnings to the NIMA system, this change has not led to an increase in export volumes.
Recent reports suggest that Iranian mills have been notified of upcoming power restrictions starting in May, which are expected to sustain finished steel import volumes. Additionally, the Iranian government’s continued electricity usage restrictions, stemming from a power shortage, are expected to further limit production capacities. As a result, BigMint believes mills will likely become more dependent on imports.
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