Iran has cancelled a plan to impose tariffs of between 5-10% on iron ore exports and may also scrap an existing 15% duty on shipments of iron ore pellets used as a raw material in steel making, Reuters reported industry representatives as saying on March 23.

Tehran’s steel industry policymakers are currently having to tread carefully when it comes to European Union competition regulators, given that on February 16 European steel lobby group Eurofer declared that Iranian steel exports had fast reached a level which made them a “threat” to European producers. EU officials are investigating alleged Iranian dumping of hot-rolled coil shipments.

The fast expansion of Iran’s steelmaking industry means the country’s producers might face potential shortages of cheap iron ore on the road ahead. To address this issue, the Iranian government has considered slapping duties on the export of unprocessed iron ore (as India has done), but this might further rile Eurofer because European producers have to import their ore.

Reuters quoted Keyvan Ja'fari Tehrani, head of international affairs at the Iranian Iron Ore Producers and Exporters Association, as saying that Iran had on March 10 changed tack with its plans to impose export duty on unprocessed iron ore or fines this month.

"There's no tax on export on iron ore lumps and no fines anymore," he reportedly said, adding that European opposition to the tariffs had played a role.

"Iran thought if it imposes duty on iron ore exports, it loses the chance to export steel to the EU," Tehrani added, saying that it was also anticipated that the existing 15% tax on pellet exports would be abandoned.