On April 11, the deputy minister at the Iranian Ministry of Industries and Mines in Iran has announced the decision to impose export tariffs on various products, including steel and raw materials, aiming to secure a sustainable supply to the domestic market. Even though the issue in question remains controversial, amid much uncertainty , certain consequences are expected to be seen soon.
Accordingly, the Iranian authorities have decided to impose an export duty, which will be applied to all products in the steelmaking chain (from iron ore to finished steel), copper, aluminum and zinc supply chain (from concentrate to metalized products), to ferroalloys, etc. The rate of the export duty will be dependent on the rate of the price increase compared to the price fixed in December 2021, which has been taken as the base price. The duties are to be imposed for a period of three months, though the start date remains to be seen. “There is so much confusion in the market, stemming from these new rules because nobody knows yet what is going on in reality,” an Iranian trader stated. “There is so much criticism of the announcement. The government is aiming to open the window to get the material needed for domestic consumption under the terms of the National Housing project. But what shall we, the local producers, do? Having no chance to export, we will have no access to foreign currency, which we need while importing raw materials like coking coal, coke etc.,” a representative of an Iranian steel billet producer commented.
On balance, the rates of export duty proposed to be implemented in Iran are presented in the following table.
|
Increase in price compared to the price in December 2021 |
5-10% |
10-15% |
15-20% |
20-25% |
25-30% |
30-35% |
35-40% |
40% and above |
|
The rate of export duty |
2% |
5% |
8% |
11% |
14% |
17% |
20% |
22% |