Khouzestan vaults to global spot as steel exporter

Khouzestan Steel Company (KSC) has established itself as Iran’s biggest exporter, overtaking Mobarakeh which is currently under the European Union’s anti-dumping watch.   

KSC exported 1.9 million tonnes of billet and slab, or about 52% of its output, in the Persian year which ended on March 20, posting a historic record for Iran's steel industry, the company’s sales deputy Bahman Tajalizadeh told Platts.

Iran’s largest producer, the Mobarakeh Steel Co., was previously also the biggest exporter of the products. The country exported 4 million tonnes of steel last year, according to director of the Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO) Mehdi Karbasian.

Tajalizadeh said KSC had regular exports to 13 countries, some 50% of which are shipped to the Middle East and North Africa region, 40% to the Far East and around 10% to American countries.  

Thailand, Taiwan, South Korea, Malaysia and Indonesia are the new destinations for Iranian steel after Chinese exports to the region decreased last year, he added.

Those countries received around 800,000 tonnes of KSC products, including billet and slab. For the current year, KSC is planning to make inroads into the American market such as Brazil and Canada.

KSC says it produced 3.6 million tonnes of semi-finished products last year and plans to increase its capacity to 5 million tonnes a year within two years, then ramp up to 13.6 million tonnes a year by 2025.

Steel was Iran's largest export item after oil, gas and petrochemicals last year, partly because of the slump in domestic construction.

The country has been boosting steel production, targeting an output plateau of 55 million tonnes per year by 2015. Iran enjoys an advantage because production costs at the majority of its steelworks are internationally competitive as a result of low energy prices in the country.

Currently, the nation produces 16 million tonnes, which is one percent of the world total. A statement on IMIDRO’s website says exports are expected to hit 20-25 million tonnes by 2025.

Iran is currently embroiled in a trade dispute with the EU over possible dumping charges after Europe’s steel lobby group Eurofer characterized Iranian exports as a threat in February.

Eurofer said Iranian exports to Europe had leapt to more than 1 million tonnes annually and that the EU was investigating alleged dumping of hot-rolled steel by the Middle Eastern country.

Charges of possible dumping are against Mobarakeh Steel Company which produces 7.2 million tonnes per year. Eurofer said Iran had increased exports of hot rolled flat steel rapidly to the European Union market and accused Iran of "trade distorting measures."

The European group also accuses Iran of protectionism for the export duties which the country plans to levy on iron ore to help maximize availability for its domestic steel mills.

Europe has already imposed penalties on China, prompting an angry response and a WTO complaint from Beijing.

The European Commission has said the EU executive had until April 7 to decide whether to impose anti-dumping penalties on Iran following an investigation into whether the country has been selling steel at below market prices.

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