Iranian Steelmakers Post Strong Growth in Sales

A large part of the growth came in Bahman, the 11th month of the year (Jan. 21-Feb. 19), as steelmakers capitalized on a devalued rial alongside improving global market conditions to boost sales. 

This is clearly evident in the disparity between output and sales volume growth compared to sales value, according to data available on Codal.ir.

The seven steel companies analyzed are all listed on either Tehran Stock Exchange or the over-the-counter exchange Iran Fara Bourse and operate on the upper echelons of the industry.

Mobarakeh Steel Tops Sales Value, Volume

Iran’s largest flat steelmaker, Mobarakeh Steel Company, topped the charts in terms of sales value. It sold 140.68 trillion rials ($3.1 billion) worth of hot- and cold-rolled, coated steel and “other” products during the period under review, up 54.97% year-on-year.

The steelmaker has so far realized 97% of its sales target for the year and only requires 3.6 trillion rials ($81.55 million) more to reach the target.

MSC, which is also Iran’s largest steelmaker in terms of capacity, produced a total of 6.26 million tons of steel products in the 11-month period to post a 13% YOY growth.

Hot-rolled coil was MSC’s main steel production with output reaching 3.74 million tons, 3.64 million tons of which were sold valued at 79.72 trillion rials ($1.77 billion). HRC production was up 8.29%, sales volume declined 1.45% and sales value surged 42.47% YOY.

MSC’s HRC output and sales are still reeling from the trade duties set on its sales this year. The European Commission set a charge of €57.50 per ton on its HRC and Thailand set a definitive duty of 7.25% on MSC shipments.

The rising consumption of flat steel in local market has made up for the loss of export markets, but is yet to boost it to previous levels.

MSC sold 634,000 tons of steel products worth 1.59 trillion rials ($35.33 million) as it produced 588,000 tons in Bahman to register 44.74%, 84.9% and 23% YOY growth respectively.

 Khuzestan Steel Sets Export Record

Iran’s largest steel exporter, Khouzestan Steel Company came next as it sold 62.95 trillion rials ($1.39 billion) of bloom and billet, slab and pellet, growing 50.22% YOY.

KSC’s total output for the period stood at 9.22 million tons with sales volume standing at 3.97 million tons, growing 4.81% and 9.69% YOY respectively. The disparity between output and sales is mostly due to KSC’s sizable pellet production and limited sales, most of which were consumed by the steelmaker.

Exports made up 2.5 million tons of the company’s total sales volume during the period, valued at 46.81 trillion rials ($951.46 million). This is so far the company’s highest record in shipment volume. 

Bahman was also good to KSC, as its sales surged 174.61% during the month to 8.61 trillion rials ($191.5 million). Output grew a meager 4.66% to 707,341 tons, while sales volume jumped 101.2% YOY to 482,763 tons.

Last month’s exports stood at 282,027 tons valued at 6.1 trillion rials ($135.7 million). 

Statistics indicate that shipments abroad are clearly more profitable for KSC compared to the local market.

 ESCO’s Lackluster Growth in Output, Sales Volume 

The financially beleaguered Esfahan Steel Company had one of the lowest growths among all producers.

Its sales grew 32.98% YOY to 37.14 trillion rials ($825.49 million), while output and sales volume moved up 4.81% and 6.91% YOY to 1.99 million tons and 2.86 million tons respectively.

Iran’s oldest steelmaker fared better in Bahman, as it sold 4.63 trillion rials ($103.1 million) of beams, rebar, coils, ingots and other products, up 58.74% YOY. Output grew 9.42% YOY to 184,193 tons and sales grew 22.88% to 298,602 tons.

ESCO is currently grappling with accumulated losses worth 21.4 trillion rials ($455 million) with a nominal capital of 33.18 trillion rials ($706 million).

Other Steelmakers

Hormozgan Steel Company came next, as it sold 23.64 trillion rials ($525.4 million) of steel products during the 11 months, rising 73.39% YOY. Its output and sales also recorded solid upticks, as they grew 34.76% and 22.8% YOY respectively to 1.37 and 1.45 million tons respectively.

Next was Khorasan Steel Complex Company with sales growing 75.58% YOY to 15.88 trillion rials ($352.9 million). Production and sales volume stood at 2.37 and 1.03 million tons, rising 17.57% and 34.93% respectively.

South Kaveh Steel Company took the next spot with only slightly less sales value, as it sold 15.14 trillion rials ($336.4 million) of products, rising 109.8% YOY. Production and sales volume were up 49% and 47% YOY respectively to 2.27 million tons and 1.12 million tons.

Iran Alloy Steel Company was at the bottom with 9.17 trillion rials ($203.9 million) of sales, up 38.65% YOY. Production was up 1.42% YOY to 371,074 tons, and sales volume grew 15.5% YOY to reach 369,305 tons.