Iranian Iron Ore Exports Jump 45%

EghtesadOnline: In spite of the Iranian government’s policy to halt exports of raw materials, customs statistics show a sharp increase in iron ore exports in the first nine months of the Iranian year (to December 20).

News ID: ۷۷۲۸۱۱

01 January 2017

Statistics show Iranian miners exported 13.08 million tons of iron ore in the period, a 45% year-on-year increase.

Iranian miners believe the trend will grow, at least until March. According to a timetable published by the Iranian Ministry of Industries, Mining and Trade, a 5% export duty will be imposed on iron ore export after its approval by the government and this duty will be increased gradually to 10% from March 2017 and 15% of the cargo FOB value from March 21, 2018, the mining source told S&P Global Platts.

As a result of disagreements among private sector miners, this timetable has not been notified yet while exporters are making efforts to ship as much iron ore as possible before the start of the next Iranian year in March, according to Financial Tribune.

Also, the duty may not become effective at all because the cash flow from iron ore exports is essential for Iranian mining, both for private miners and semi-governmental iron ore producers.

About 34% of 7.09 million tons of concentrated iron ore produced by Golgohar, Iran’s largest iron ore miner, have been exported in the nine-month period, representing more than 30% of the company’s total income.

“In the future, we may need to import a part of the country’s iron ore, but at present there is an overcapacity both in iron ore and concentrated iron ore production compared with the [consumption in] steel industry,” a Tehran-based iron ore trader told Platts.

The production of iron ore in Iran is estimated to be 48 million tons in 2016, including 5 million tons from small privately-owned miners, according to Iran’s Iron Ore Producers and Exporters Association. That total is 8% lower than the record 2013 production.

Many private miners are not working now and about 9 million ton/year of the country’s capacity is idle and awaiting iron ore policy decisions, a source told Platts.