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The new round of sanctions would not cause any substantial change in the conditions of steel manufacturers and other targeted industries. said ISPA Board Member Bahador Ehramian on Sunday.
It is because the US has already included Iran’s entire (metals) industry in the sphere of its sanctions. Ehramian added.
Washington imposed a series of wide-ranging bans on Iran’s trade of metals in May 2019. exactly a year after it decided to pull out of a major nuclear deal between Iran and international powers.
The metals trade bans came on top of a series of harsh sanctions imposed on Iran’s sale of oil and gas which has traditionally accounted for the bulk of the country’s revenues over the years.
However. numerous reports and studies have shown that unlike the oil sanctions. the bans on metals have largely failed to halt Iran’s growing export of various mining products as cargoes are normally shipped through third countries. making it difficult for the US to spot the origin of the shipments.
A recent report by Iran’s ministry of industries showed that steel exports had surged by nearly a quarter year on year between March and November 2019 to reach 7.8 million tons or $3 billion in value terms.
US president Donald Trump said earlier this week that he would impose a new series of tough sanctions on Iran after the Iranian military fired missiles at US bases in Iraq in response to the US assassination of an Iranian military commander January 3.
However. traders said the new bans. which mostly target major Iranian steel companies. were nothing to worry about.
The Sunday report said that unlike the oil industry. the metals sector in Iran was highly flexible in dealing with the US sanctions.
The reality is that if the target is the export and currency sources of the major mining companies … this group would carry out its exports through some 2.000 private trade certificates of domestic and foreign origins. said the report.
Reza Shahrestani. another board member at ISPA. said that the new bans would only give a little more leverage to Iran’s customers when they want to finalize the prices.
The sanctions would slightly increase the bargaining power of the customers while it is expected that they would make it difficult to transfer money. said Shahrestani.
Iran’s increased export of various mining products comes despite the fact that country maintains some harsh tariffs on export of raw metals. including iron ore.
The policy is largely aimed at allowing mills and smelters across the country to increase their output and export products that could generate more hard currency for the government.
Iran. a leading producer of steel and other precious metals like copper. levied the duties in late September as major smelters and mills across the country said they were facing inventory shortages due to a rise in exports of raw metals to countries like China.
A harsh tariff of 25 percent has been imposed on iron and manganese. including the export of concentrates. while raw copper exports face a 10-percent tax.
In a bid to fend off rising criticism from some exporters. the Ministry of Industry. Mine and Trade (MIMT) revised down some of the tariffs earlier this month. including for copper concentrate. chromite and lead concentrate.
Late in last month. the National Iranian Copper Industry Company (NICICO) announced that it has registered a higher demand than current supply and output levels in the country. reminding that the fast-growing sector is disappointing US-imposed sanctions against Tehran’s metal industries.
Early in December. a report was out showing that a total sum of $3 billion was slated to be invested in the copper industry of Iran as the country is eyeing a bigger share in the international market of the precious metal.
The report recounted that more than $3 billion will be invested in various copper industry projects across Iran in the next 5 years. allowing the country to be more competitive and have a better share of an international market that is facing a surging demand for the precious metal.
The report quoted the head of IMIDRO. Iran’s largest metals and mining sector group. as saying that the country was aiming to increase both the output and the resource discovery activity in the copper sector.
Khodadad Qaribpour said more than $120 million had been spent on a major project finished earlier this year to produce 610.000 tons of sulfuric acid. a key ingredient and by-product in copper production. each year.
Qaribpour said activity was surging at three main copper hubs in southeast and northwest of Iran.
Iran’s metals sector has seen a rapid expansion over the past two years as the government seeks to offset the impacts of a series of American sanctions on revenues that were once derived from oil.
