The impact of the Middle East conflict on the global supply chain has added a new case. On April 27, according to relevant media reports, Iran officially announced the suspension of billet and steel plate exports, with the suspension period until May 30. The specific time for resuming exports will be further clarified based on subsequent developments.
Iran's decision to suspend steel exports this time came after Israel launched military strikes on Iran's steel facilities. According to reports from authoritative media, Israeli Prime Minister Netanyahu stated on April 4 local time that the Israeli military carried out precise strikes on Iran's steel mills and petrochemical plants that day, and had successfully destroyed 70% of Iran's steel production capacity. This strike has directly affected the normal production and export layout of Iran's steel industry.
It is worth noting that Iran is not a "marginal player" in the global steel industry, but an important producer with a certain industrial scale. According to public data from the World Steel Association, Iran's annual steel output has increased from 14.4 million tons in 2013 to 32 million tons in 2025, doubling its output in 13 years with a compound annual growth rate of 6.3%. It has now successfully ranked among the world's top ten steel producers.
In 2025, Iran's steel output accounted for approximately 1.8% of the world's total steel output and 3.8% of the world's steel output excluding China. In terms of output volume, Iran's steel output is equivalent to that of Germany (34 million tons), about 40% of that of the United States (82 million tons), and close to a quarter of Europe's total steel output (134 million tons). If Israel's strikes have indeed destroyed 70% of Iran's steel production capacity, this means that more than 20 million tons of annual production capacity will disappear from the global steel market, which will have a significant impact on the global steel supply pattern.
From the perspective of Iran's steel production and sales structure, about 30% of its domestic steel output is used for export, and 70% is used to meet domestic market demand. After the sharp reduction in Iran's steel production capacity this time, the approximately 9 million tons of steel products originally intended for export will be prioritized to fill the domestic market gap. This means that this volume of steel will almost undoubtedly withdraw from the global steel trade flow, further exacerbating the tension in global steel supply.
For other regions around the world, filling the market gap left by the suspension of Iran's steel exports faces significant structural obstacles. Relevant analysis from Citigroup points out that Iran's steel production is highly dependent on the direct reduced iron (DRI) gas-based process, which is fundamentally different from the global mainstream blast furnace steelmaking route and cannot be easily replaced. In 2024, Iran's DRI output reached 34.2 million tons, making it the world's second-largest DRI producer.
From the perspective of the global raw material structure, DRI accounts for only about 7.5% of the global raw materials for crude steel production, but this proportion exceeds 80% in Iran—that is to say, Iran's steel production relies almost entirely on the process of reducing iron ore with natural gas. Once this steel industrial chain based on its own natural gas reserves breaks, it will be difficult for other countries to fill this gap with their own blast furnace capacity, and the global steel raw material structure may face a fundamental restructuring.
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