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GCC demand boosts Iranian billet market despite sanctions and global competition

The Iranian billet market is characterized by its export-driven nature, competitive pricing, and reliance on key regional markets like the GCC.

GCC demand boosts Iranian billet market despite sanctions and global competition

The Iranian billet market is experiencing a period of renewed momentum thanks to increased demand from Gulf Cooperation Council (GCC) countries and recent progress made by key producers. These developments have put Iran in a competitive position in the regional steel trade, despite ongoing challenges such as sanctions and global competition.

This week, Iranian billet prices reflected notable diversity, with offerings ranging between USD 410–USD 420 per ton FOB , depending on the supplier. Major producers, including industry giants like Esfahan Steel Company (ESCO) and Sirjan Iranian Steel Company (SISCO) , were trading billets at approximately USD 420 per ton FOB , while smaller suppliers offered more competitive rates of USD 410–USD 415 per ton FOB toward the end of the week ending March 8. This pricing segmentation highlights the adaptability of Iranian mills in catering to varied buyer preferences across international markets.

A significant turning point for the industry came when ESCO and SISCO secured the Emirates Conformity Assessment Scheme (ECAS) certification, a mandatory requirement for products entering the UAE market. This achievement not only enhances the credibility of Iranian billets but also paves the way for increased exports to the UAE, a key hub for construction and infrastructure projects in the GCC. Following this news, billet prices surged by USD 10 per ton , reaching USD 460–465 per ton CFR Jebel Ali , underscoring growing buyer confidence in Iranian steel products.

The rise in demand from GCC countries has been a major driver of this price hike. As the UAE continues to invest heavily in mega-projects like Expo City Dubai and sustainable urban development initiatives, the need for high-quality raw materials such as billets has intensified. Iranian mills, leveraging their cost advantages due to low energy costs and currency devaluation, are well-placed to meet this demand and capitalize on emerging opportunities.

However, the road ahead is not without challenges. Iranian billet producers face stiff competition from regional rivals like Türkiye and India, which often offer higher-quality products or more established brand reputations. Additionally, logistical inefficiencies and sanctions-related restrictions on banking and shipping remain persistent hurdles. Despite these obstacles, the acquisition of certifications like ECAS signals Iran’s commitment to overcoming barriers and expanding its footprint in regulated markets.

Looking forward, Iranian steelmakers are eyeing further growth by diversifying their export destinations. Markets in Southeast Asia, Africa, and South America present untapped potential, offering avenues to reduce reliance on traditional buyers and mitigate risks. Investments in technological upgrades and quality improvements are also expected to bolster Iran’s competitiveness on the global stage.

In conclusion, the Iranian billet market is poised for a transformative phase, fueled by rising regional demand, strategic certifications, and a focus on market diversification. As key players like ESCO and SISCO continue to strengthen their positions, Iran’s steel industry is set to play an increasingly vital role in meeting the growing needs of global infrastructure and construction sectors.

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