Iran's steel prices rise amid energy shortage in plants

Iran, one of the largest DRI producers in the world, is facing severe energy shortage which has pushed up prices of sponge and other steel commodities like long steel products etc. in the country.

DRI plants in Iran mostly consume and depend on natural gas supply. Due to the natural gas shortage this winter, the Iranian government sharply cut the supply and imposed some restrictions on consumption of gas to DRI plants. As a result of it, prices have spiked.

SteelMint's assessment for rebar increased to Rial 189,000/kg exw-Esfahan on 19 December, rising by Rial 12,500/t in a week's time.

Sharp increase in pellets exports: Iran exported 2.662 mnt of pellets in the last eight months of the Persian calender which is 228% higher compared to the same period of the previous year. The reason of this increase was a decrease of gas supply to DRI plants because of its shortage in the past winter. So, unused pellets were accumulated in factories and the government granted permission to export pellets.

~ Source: Petrometals