During the past three months, three major contracts for development of steel industry in the country have been signed with domestic and foreign countries. These contracts have been signed with $600 million forex credit for development of Tabas Coal Complex, Khuzestan Steel Industry and Isfahan Steel Mill.
Based on plannings until March 21, the steel production level in Iran would reach 6.2 million tons, this is while in the beginning of the First Economic Development Plan over 4-4.5 million tons of steel was imported into country annually.
The capacity of Mobarakeh Steel Complex, the first integrated flat steel production plant in the Islamic Republic of Iran based on the DRI-EAF-CC route, would reach 4 million tons in near future. Mobarakeh Computer Center was established for automation of the production line and promotion of Management Information Systems (MIS) in the Complex. The Computer Center was launched spending $4.6 million in less than six months.
Iran currently produces 3 million tons of steel.
Based on another contract Mobarakeh Steel Complex would increase production to 4.2 million tons from the current 3.1 million tons. The 299.5-euro contract was signed between Iran and three Italian companies on a buy-back basis; which means the capital would be returned to the investors by selling the products. Financial resources of this contract would be provided by Belgian Bank located in Milan.
The first phase of the project was inaugurated last month by the President based on which the end products of Mobarakeh raised from the previous 2.4 million tons to 3.1 million tons. With the inauguration of the second phase of Mobarakeh development plan, the production capacity of raw steel would reach 4.2 million tons, while at the moment the production level of raw steel is 3.4 million tons.

Given the fact that the official commissioning of this project started a short while ago, a quick growth is noticeable, to the extent that the complex has increased its production to the nominal capacity and has succeeded to offer its products on international markets.
Officials of Iranian steel industry have announced that they are planning to increase domestic production initially to 18 million tons and ultimately to 25 million tons per year.Despite the fact that Iran has easy access to raw materials and cheap energy resources, domestic production and per capita consumption of steel in Iran is way behind that of other countries.
Officials of the steel industry pursue the policy of expanding exports and recent approval of the Commerce Ministry regarding the exemption of exports from regulations of State Disciplinary Organization will substantially help increase exports. Decreasing the forex expenditure for producing each ton of steel from $1400 to $750 is another goal of the sector.
It should be mentioned that steel and iron industries are one of the significant indicators of sustainable growth and, therefore, economic experts should pay special attention to planning, relative advantages and added value. If production is directed toward exporting to global market, positive impacts could be expected in the economic balance, and this would in turn lead to national security and reduction of economic dependency on other countries.
One of the important issues which should be heeded in the manufacturing activities is the plentiful raw materials in the country, including iron ore, natural gas, etc. That’s why in European countries, the total costs for extraction or purchasing these materials from abroad are much higher than the production costs in Iran.