It is reported that this year Iran is the largest buyer of Russian steel. By results of the first three quarters of current year the shipments resulted to 3.366 million tonnes by 55% more than a year before for the same period. However it is hardly possible to say that Russian companies are well aware with Iranian steel market as well as Iranian businessmen do not know all opportunities of potential Russian partners.
Iran Metallurgical Conference held in Tehran, Iran, on November 2nd to 3rd 2009 by Rusmet group with support of a number of partners in Iran, Russia and other countries, aimed to deepen knowledge of each other to establish and strengthen business connections between companies. As it seems to us, the aim has been achieved. A sufficient assistance to do that has been made by Iran-Russia Joint Chamber of Commerce. The session has been opened by its President, Mr A Asgarolladi and Mr G Ghiafeh Vice President has been an irreplaceable presenter at the conference. Also the Economical Cooperation Group Co, particularly its affiliate company, Iran Steel Service center, has invited Iranian delegates and made some necessary arrangements, as well as Russian Embassy and Trade Mission in Iran and Iran Embassy in Moscow.
The conference has risen a great interest in Iran. It has been the first opportunity for many local steel companies for the last thirty years to meet each other at such an event to exchange opinions and discuss industry problems. Even while the speech of one of Iranian speaker a lively discussion in the Presidium has been started to some extend it was an extemporary panel discussion. There were over 120 delegates at the conference, most of them from Iran or Iranian representatives of foreign companies. It is hardly possible to count how many business meetings have been made between Russian, Ukrainian, Iranian and other countries representatives during the conference. We have been regularly asked by Iranians who can they meet for example to purchase 10,000 tonnes of billet.
Actually billet is the hottest Russian steel product in Iran. In the first three quarters it has been shipped 1.7 million tonnes of billets from Russia there, so it is over 50% of total Russian steel exports to Iran. There are a lot of rerolling mini mills in the country most of them are located in the North close to the Caspian ports. Simultaneously, there is a poor availability of domestic billet at the market.
In general Iran is perspective for Russian steel: the country keeps on development of non oil industries and infrastructure. However, one of non oil industries Iran actively develops is steel making. Last year it has been commissioned several projects for steel smelting and rolling in Iran. Currently total crude steel capacities of Iran are estimated at 17 million tonnes annually and by 2012 according to Iranian experts it should be over 22 million tonnes per annum.
Steel consumption in the country grows rapidly by high rates, with maximum demand to be kept further in more economically advanced provinces at the North of the country. Transport connections in the country are not as good as desired to be: in 2005 total length of railways was 8300 kilometers only so it is still more profitable to import steel products then to transport it from other parts of the country.
The largest local market is Tehran a 15 million megalopolis and essential industrial center. There is plenty of construction in the city however some of the projects are stopped. Nevertheless, by words of Iranian steelmakers, it is expected that government recommence financing of many construction projects in the end of the year, so the demand is also expected to go upwards.
At the closing session Iranian representatives repeatedly noted that such conference should be arranged on the annual basis. This coincides with our intentions. And we hope Iran Metallurgical Conference 2010 will gather even more participants.