0915 GMT May 23, 2019
“Afghanistan, Turkey and Iraq are our major export destinations for aluminum and the recent US-led sanctions will have no impact on exports to these countries unless banking difficulties impede us from the set target,” he was quoted as saying by Mehr News Agency.
He said that the new sanctions could push the total production prices up but the biggest challenge for Iran’s aluminum industry has been supplying the needed raw materials via imports, which has been done by swapping under previous sanctions.
On Saturday, Chairman of Iranian Steel Producers Association (ISPA) Bahram Sobhani called for modifying and correcting internal regulations for countering sanctions in the field of steel exports.
Pointing to the restrictions created for exporting steel products of the country, he added, “to reduce impacts of sanctions, internal instructions should be facilitated and existing barriers should also be removed.”
In his reaction to the limitations created by US government for exporting some metal products such as steel, he stated, “Under such circumstances, domestic steel producers are advised to produce steel within the country.”
US President Donald Trump last week imposed sanctions aimed at punishing anyone who buys or trades in Iranian iron, steel, aluminum and copper.
But the steel and mining sector, Iran’s second-largest source of foreign revenue, may prove harder to target.
Relatively decentralized, made up of small- and medium-sized companies and selling mostly to nearby countries, it is less vulnerable to sanctions, experts say.
“The US cannot completely stop exports. Some countries and companies with no US ties can work with Iran,” said industry analyst Mojtaba Fereydouni.
“Also, our main export markets are our neighbors – Iraq and Afghanistan, and recently Syria and Oman.”
He pointed out that Iranian metals firms, no stranger to sanctions, were relatively unscathed by an initial tranche of restrictions reimposed last year.
“In August, steelmakers were barred from importing essential raw materials and any trade in steel products... yet exports are up,” he said.
According to official data, Iran’s mineral exports grew about 20 percent year-on-year to $6.2 billion in the 12 months to March 20, with steel making up over two-thirds of that figure.
Another industry official, Amir Sabbagh, said that while metals firms will face extra costs, they will be “manageable” as the country’s weakened currency has made exports more profitable.
Sabbagh, an official with a state-owned mining firm, wrote on Telegram that the sanctions’ main impact would likely be to increase sea freight costs and reduce exporters’ bargaining power.