Iran, one of the largest steel producer in MENA region has recently faced backlash from many countries owing to the US sanctions. Recently India’s largest commercial bank SBI has alerted all of its offices on the issue of dealing with the companies doing business with Russia and Iran which are battling sanctions.
All branches have been directed to refrain from taking new exposure in any form, such as letter of credit and bank guarantee, for any transaction related to Iran with immediate effect, according to a SBI internal communique.
Owing to which Indian ferro alloys exporters are worried about doing business with Iran, as Iran is considered to be an emerging market for Indian ferro alloys. India has been exporting ferro alloys mainly ferro manganese to Iran.
During CY’17, Iran imported around 30,000 MT ferro manganese from India and in current year till Feb’18 the nation has already imported around 10,000 MT from India.
Major Importers of Indian Ferro Manganese
| Countries | Quantity | % Share |
| United Arab Emirates | 0.19 | 19.01 |
| Iran | 0.18 | 18.35 |
| Taiwan | 0.08 | 7.77 |
| Japan | 0.08 | 7.63 |
| Indonesia | 0.06 | 6.29 |
| Italy | 0.06 | 5.62 |
| Pakistan | 0.05 | 4.58 |
| Netherland | 0.03 | 3.1 |
| South Korea | 0.03 | 3.01 |
| Kuwait | 0.03 | 2.8 |
| Brazil | 0.02 | 2.18 |
| Others | 0.19 | 19.65 |
| Grand Total | 0.98 | 100 |
Quantity in MnT
Source: SteelMint
Post Sanctions:
1- Post sanctions it is believed that the ferro alloys export to Iran will come down as a major chunk of export will be hit because of it.
2- Direct transaction with Iranian party will stop as no bank will be doing business with Iran.
3- Sellers are likely to look for other options and routes to export ferro alloys to Iran. It is expected that brokers or middle man might become a vital resource to do business with Iran.
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