There remains a gap between Iran's consumption and production of flat steel products despite increases in the country's crude steel capacity, according to the secretary of the Iranian syndicate of steel pipe and profile manufacturers, Amirhosein Kaveh.
Since the slump in Iran's construction activity, production of long steel products has risen above the level of consumption, although the opposite is true in terms of flat products. Downstream industries' consumption of strip -- mostly HRC -- cannot be fully supplied by domestic producers, Kaveh added.
The Iranian government is following a very protective policy for the upstream steel industry and this has increased production costs for downstream users, he said.
The import duty on strips has been increased twice in one year: first from 4% to 10% and then to 20% in May 2016 to protect domestic industry against dumping from China.
"But after about seven months we still have to import our thin-gauge flat products but with an unreasonable cost," Kaveh said.
Mobarakeh Steel Co (MSC), the biggest producer in Iran, said in November that it has formally asked the government to decrease the duty on hot and cold rolled coil to 15% from 20%, but the government has yet to announce any change.
According a report published by Iranian Steel Producers Association, in spite of increasing crude steel production in Iran, the country's production of finished steel shows a falling trend. The report added that crude steel output rose to 10.74 million mt in the first seven months of the current Iranian year (ending October 21), which is 8% more than in the same period of last year, but finished steel output decreased 4% to 10.28 million mt.
