Following an increase in exports of semi-finished products from Iran, Iranian rolling mills attended a meeting organized by the Iranian Steel Producers Association Saturday to assess the conditions of billet supply in the domestic market.
The meeting focused on the billet shortage, according to Hamidreza Taherizadeh, vice president of the group, quoted on the ISPA website.
He said there was almost no high-quality billet available in the domestic market now and the major producers are exporting their output.
Khouzestan Steel Co (KSC), Esfahan Steel Co (Esco) and Pasargad Steel are the biggest exporters of billet at present, Taherizadeh said.
According to some reports, more than 70% of the rerollers' capacity was idle during last week due to raw material supply problem, he added.
Taherizadeh also said that ISPA had a meeting with Mohammad Nematzadeh, minister of industry, mining and trade, last week and asked the ministry to allocate a portion of billet output to domestic rerollers.
Taherizadeh emphasized that, according to Iran's law on "elimination of barriers to production," supplying downstream industries' requirement should take priority over exports.
According to a report previously published by the ISPA, some 439,000 mt of semi-finished steel products including 261,000 mt of billet and 178,000 mt of slab were exported during the first month of the current Iranian year (to April 20), up 28% on the same month in the previous year, mostly to the UAE, Thailand, Taiwan, Oman and Turkey.
As S&P Global Platts reported earlier, Iran plans to increase steel exports to 8 million mt in the current Iranian year, about 50% more than the previous year, and to 15 million mt/year during Iran's sixth development plan (to 2021).
Ahmad Sadeghi, managing director the Iranian prime long steel producer Esco, has recently announced that all of the company's output is being exported now.
An industry observer close to private steel mills believes that rerollers are seriously concerned about their required billet because import of semis is very low, near to zero, and major producers of steel prefer to export as much as possible.
He added, Iran probably will slow down export of billet for a few months, but this may not last long because steel production capacity is increasing.
