- 19% growth in iron ore production in first 10 months of current fiscal
- Pellet production up by 32%
- DRI output registers impressive Y-o-Y growth of 25%
Despite the fact that it is reeling under the effect of severe economic turmoil and rapid depreciation in the Iranian Rial due to the blanket sanctions imposed by the United States, the Islamic Republic of Iran is cruising along the highway of phenomenal capacity expansion in the iron and steel sector, aiming to emerge as a major global steel producer in the years to come.
While Iran is the largest crude steel producer in the MENA region, the Islamic Republic is striving to become as one of the largest steel producing nations in the world. The country has adopted the Vision 2025 Plan that envisages enhancing steelmaking capacity to 55 MnT per annum by 2025 – by all means a mammoth undertaking. According to Worldsteel Association’s Steel Statistical Yearbook unveiled recently, Iran produced 21.236 MnT of crude steel in 2017 – up from 17.895 MnT in 2016 – a 19% rise Y-o-Y. In the first 10 months of CY’18, Iran has produced 20 MnT of crude steel. It is therefore, evident that the steel industry in the country is poised for a take-off.
Iran’s Iron Ore Production Heads North
Iran produced 29.64 MnT of iron ore concentrate in the first eight months of the current fiscal (March 21 to November 21), registering 19% growth compared to the corresponding period last year. According to the Iranian Mines and Mining Industries Development and Renovation Organization’s latest report, Gol-e-Gohar Mining and Industrial Complex accounted for 10.6 MnT of the total output, followed by Chadormalu Mining and Industrial Complex with 6 MnT, Iran Central Iron Ore Company with 3.55 MnT and Middle East Mines and Mining Industries Development Holding Company with 3.34 MnT.
Other producers were Goharzamin Iron Ore Company with 2.96 MnT, Opal Parsian Sangan with 1.93 MnT, National Development Company with 914,447 tonnes and Jalalabad Iron Ore Complex with 325,144 tonnes. Iron ore concentrate output in the eighth months ending November 21 was 3.74 MnT – a 25% surge compared to last year.
32% Rise in Pellet Production
Similarly, pellet output hit 27.47 MnT, up 32% Y-o-Y. Gol-e-Gohar was, expectedly, the largest producer with 7.99 MnT, followed by Mobarakeh Steel Company with 5.11 MnT, Khouzestan Steel Company with 4.13, MIDHCO with 3.35 and Opal Parsian Sangan with 2.47 MnT.
Other producers were Chadormalu with 2.31 MnT, Sangan Mineral and Industrial Company with 1.66 MnT and Khorasan Steel Company with 422,598 tonnes. Pellet production witnessed a 10% Y-o-Y rise during the eighth month to 3.11 MnT.
DRI Production Soars
DRI production stood at 16.51 MnT during the eight months under review, up 25% Y-o-Y. Mobarakeh had the lion’s share with 4.89 MnT, followed by KSC with 2.47 MnT, Hormozgan Steel Company with 1.15 MnT, South Kaveh Steel Company with 1.02 MnT, Golgohar with 946,526 tonnes, Khorasan Steel Company with 872,453 tonnes, Saba Steel Complex with 820,010 tonnes, Arfa Steel Company with 576,504 tonnes, Ghadir Iron and Steel Company with 553,162 tonnes and MIDHCO with 551,882 tonnes.
DRI production reached 2 MnT during the month ending November 21, indicating a 19% growth Y-o-Y.
Downstream Output Inches Up
Turning the spotlight away from raw materials we see that 13.06 MnT of slab, bloom, billet and ingots were produced during the period, marking a rise of 11% Y-o-Y.
Mobarakeh Steel Company, with its subsidiaries Saba and Hormozgan Steel, was the biggest producer with 6.31 MnT. KSC came next with 2.51 MnT, followed by ESCO with 1.46 MnT, South Kaveh Steel Company with 679,495 tonnes, Khorasan Steel Company with 675,738 tonnes, Chadormalu Steel Company with 575,062 tonnes, Arfa Iron and Steel Company with 555,185 tonnes and Iran Alloy Steel Company with 286,190 tonnes.
During the eight months under review, 7.51 MnT of finished steel products, including hot and cold-rolled coils, rebar, beams, pipes, wide and galvanized sheets were produced, which indicates a rise of 7% Y-o-Y.
MSC and its subsidiary Saba Steel had the largest share of production with 4.56 MnT, followed by ESCO with 1.42 MnT, Oxin Steel Company with 435,545 tonnes, Khorasan Steel Company with 369,495 tonnes, Azarbaijan Steel Company with 225,740 tonnes and IASCO with 168,201 tonnes. Production of finished steel products stood at 964,643 tonnes, marking an 8% growth Y-o-Y.
According to Deputy Minister of Industries, Mining and Trade Jafar Sarqeini, Iran’s steel production capacity currently stands at 34 MnT per year. Iran’s October steel output grew 10.6% Y-o-Y to hit 2.07 MnT. The Middle Eastern nation has been ranked the world’s 11th biggest steel producer during the period under review. It is placed between Italy (10th) with 20.61 MnT and Taiwan (12th) with 19.24 MnT.
3rd Iron Ore & Pellet Summit
According to a senior official of Gol-e-Gohar Mining and Industrial Company, Iran has been working to increase its iron ore processing capacity, including both DRI and HBI production to feed its steelmaking expansion target. Iron ore production, the official stated, was still lagging with a view to the phenomenal capacity expansion plans that the country has chalked out. Furthermore, domestic expansion and focus on domestic demand-supply equilibrium, he said, was essential to offset the detrimental effects of the sanctions that the United States has imposed on the Islamic Republic. Steel industry experts are of the view that the productive momentum will continue throughout 2019 and beyond. However, ensuring uninterrupted raw material supply is essential to keep that momentum going. Keen to gain a perceptive insight of the forces that will reshape Iran’s buyout steel industry in the days to come? Book your seat at the 3rd Iron Ore & Pellet Summit to be held at Delhi NCR on 18 & 19 February, 2019.