Mobarakeh Steel Co (MSC) has asked the Iranian government to reduce the import duty on steel strip products by 25%, company managing director Bahram Sobhani told S&P Global Platts.
"To support downstream industries MSC has suggested to the government to decrease the import duty for both hot and cold rolled coils to 15% from the current 20%," he said.
"It is not clear for us when the new duty will be imposed or practical, but we believe that, as long as the country needs to import some materials, duties are an implement to regulate the prices in the domestic market and should be reviewed from time to time according to the requirements," he added.
One steel market player said the duty will be reduced soon as the price of strip products in the domestic market is currently above international prices and it will raise the cost of projects as well as production costs for downstream industries such as vehicles and pipe makers.
The Iranian syndicate of steel pipe and profile manufacturers believes five percentage point cut would not be enough to secure the country's supply, syndicate secretary Amirhosein Kaveh told Platts.
"The country's demand clearly cannot be supplied by domestic producers completely and there is a shortage which should be imported with a reasonable cost," he said. "We believe the import duty should be decreased to 5% and also export should be limited by imposing an export duty on strip products."
Iran has a highly protective policy towards its steel industry.
There is a 15% import duty in place on semi-finished products (HS codes 72181000, 72189100); 20-26% for flat products (excluding stainless steel) and 26% for most long products such as I-beams and H-beams.
Some 2.57 million mt of steel products were imported into Iran in the first seven months of the Iranian year (up to October 20), according to customs statistics, 3% up on last year.
Demand for flat products and alloy steel is expected to rise further as a result of the removal of sanctions and new projects in the oil, gas and petrochemicals sectors.
