[ferro-alloys.com]Iran's steel exports have remained about steady in the first nine months of the current Iranian year despite the US' reimposition in August of sanctions on metals trading, according to Mohsen Parvan, CEO of Tehran-based AASIM Consulting Group.

For the full year, Iran's steel exports may equal last year's record of over 9 million mt, as links with existing steel trade partners, particularly in the Middle East, Russia, China and the EU, have largely remained in place, he said.

"Iran has so far exported 6 million mt of steel in this Iranian year [which ends March 20], similar to the previous year. At least half is semi-finished products such as billet and slab," Parvan said in an interview in London last week.

AASIM operates an engineering consultancy with an Indian partner in the Iranian iron, steel, mining and chemical sectors.

Billet steel is being supplied to Oman for re-rolling, with other customers in Qatar, Iraq, the UAE, CIS nations including Ukraine and Kazakhstan and small amounts being sold into the EU, specifically Germany, Spain and Italy, he said.

Starting August 6, the US reimposed secondary sanctions on trade to and from Iran in steel and aluminum products, gold and precious metals, graphite and coal, giving non-US persons 90 days in which to wind down their steel/metal trade activities with the country or risk US enforcement action. Other sectors of Iran's economy, including oil, energy and shipping, were affected from November.

The European Parliament passed a blocking action in early August protecting EU citizens and governments from the impact of the US secondary sanctions.

The EU and other governments, including the UK, Germany, France, Russia and China -- which remain committed to the 2015 Iran nuclear deal from which the US withdrew last May -- could thus take steps to protect their countries' businesses and trade with Iran, Sue Millar, London-based partner in international law firm Stephenson Harwood said at the time.

A significant weakening of the rial since the US announced it was reimposing sanctions means Iran's steel remains competitive on world markets. This, sources say, has helped boost Iranian exports of finished, higher-value added products in recent months.

The latest figures from the Iranian Steel Producers' Association (ISPA) show exports totaled 5.273 million mt of steel products in the first eight months of the current Iranian year (March 21-November 21) including 1.92 million mt of finished products, up 104% year on year, and 3.335 million mt of semi-finished products, down 21%, compared with around 5.165 million mt in the year-ago period, which included 940,000 mt of finished and 4.225 million mt of semi-finished products.

REINING IN IMPORTS

Iran has in turn generally reined in its imports. Steel imports, mainly of stainless, flat and pipe products from the CIS, China and the EU are likely to be around 4 million mt this year, according to Parvan.

Since 2015, Iran has pushed forward with a national steel industry development program, involving an increase in the annual production capacity to 55 million mt by 2025, from current nominal capacity of 32 million mt/year. According to ISPA, the country had originally expected to increase exports of steel and direct reduced iron products to 12 million mt in the current year and to 15 million mt/year from 2025. But this is now considered a challenging target, not specifically because of the renewed sanctions, but because of rising steel protectionism worldwide since US President Donald Trump upped the country's import tariffs in March under Section 232 legislation.

Iran has become a significant steel exporter in recent years as its domestic market growth has been insufficient to absorb its output growth. "Domestic steel consumption is seen continuing at around 20-25 million mt/year as new investments in infrastructure have stopped," Parvan said. "The main steel strategy is still to export."

Iranian exporters do not typically use letters of credit and their steel export trade, developed via traders without US links, has therefore not been greatly impacted by the renewal of US sanctions, trading sources said.

（S&P Global Platts）

• [Editor:王可]