The Director General of Iran’s Mineral Industry has lowered the export tariffs on billets and slabs from the previously announced 11% and 17% to 2% and 5%, respectively, in the latest announcement. Meanwhile, the latest amendment completely eliminates export tariffs on flat and long materials.
So far, Iran has made two adjustments to its export tariff policy after announcing plans to implement it for three months, with only about one month left for tariff implementation.
In early March, the Iranian Ministry of Industry, Mines and Trade released relevant documents earlier this week, planning to impose new export tariffs on various products, including steelmaking raw materials and steel products, from March 21 to June 21. According to relevant documents, the main export varieties can have tariffs as high as 11% for direct reduced iron, 17% for billets, 22% for slabs, and 8% for rebar, wire rod, and section steel.
In early May, due to strong opposition from market participants and the complexity of export tariff calculation methods, Iran adjusted its export tariffs by 11% for billets and 17% for slabs. However, the market still called for further tariff reductions.
Market participants are not optimistic about Iran’s imposition of export tariffs, and some traders say that information on tariff adjustments is released almost every year, but it does not have a significant impact on market transactions. However, after the initial release of the tariff policy this year, most traders expressed concerns because the tax rate was relatively high and there were specific collection methods. However, due to the confusion in the calculation method, there were still difficulties in implementing it in the end.
In April 2022, due to the uncertainty of tariff policies and consecutive holidays in Iran, the export market was relatively quiet. Currently, Iran’s export trade is proceeding smoothly. Due to the government’s upcoming power rationing measures, steel billet prices have recently increased, and market transactions are active. At present, the domestic price of billets in Iran is about 650 US dollars per ton, and the market is waiting for the bidding results of slab exports from Iranian steel mills.