March 27โ31, 2026 โ Coordinated airstrikes hit Mobarakeh Steel Company (MSC) and Khuzestan Steel Company (KSC) , two of Iranโs largest steel producers.
Confirmed:
- MSC power plant and substation damaged; operations suspended.
- KSC storage silos and production lines damaged; operations suspended.
- Both facilities are key suppliers to domestic and export markets.
Unconfirmed:
- No official Iranian damage assessment released.
- Actual production loss tonnage has not been independently verified.
- The widely cited โ70% capacity destroyedโ figure comes from a single Israeli military source.
๐ NOTE ON DATA: The analysis below uses preโattack capacity baselines and analyst estimates. Actual losses may differ. The impact projections assume the reported damage levels are accurate and production remains disrupted for an extended period.
๐ PREโATTACK CAPACITY BASELINES
| Facility | Location | Annual Crude Steel Capacity | Key Products |
|---|---|---|---|
| Mobarakeh Steel (MSC) | Isfahan | 11.8 million tons | HRC, CRC, coated coil, slab |
| Khuzestan Steel (KSC) | Khuzestan | 3.6โ4.2 million tons | Billet, bloom, rebar, structural steel |
| Combined | โ | 15.4โ16.0 million tons | โ |
Together, these two mills represented approximately 45โ50% of Iranโs actual steel output in 2025 (analyst estimates).
๐ญ IMPACT SCENARIO โ IF DAMAGE IS SUSTAINED
If the reported damage is accurate and outages last 3โ12 months, the following supply gaps would emerge:
Flat Products (MSC)
| Product | Annual Export Volume (Iran) | Immediate Effect |
|---|---|---|
| HRC / CRC / Coated | 300,000โ350,000 tons | Exports halted; Iraq (90% of flat imports from MSC) and UAE transshipment hub severely affected. |
SemiโFinished & Long Products (KSC)
| Product | Annual Export Volume (Iran) | Immediate Effect |
|---|---|---|
| Billet / Bloom | 1.9 million tons (2025) | ~50% of billet exports cut; Thailand, Indonesia, UAE face immediate shortages. |
| Rebar / Structural | 200,000+ tons | Iraq (70% of rebar imports from KSC) faces construction supply crisis. |
Total potential export loss under prolonged disruption: 500,000โ550,000 tons/year.
๐ MARKET IMPLICATIONS (SCENARIOโBASED)
| Affected Market | Risk | Alternative Supply Options |
|---|---|---|
| Thailand, Indonesia | Billet shortage | China, India, Russia |
| UAE | Transshipment disruption; freight cost spike | Direct bookings from China/India; local mills |
| Iraq | Rebar & flat steel supply gap | Turkey, China, India |
| Global | Persian Gulf billet premiums up 3โ5% WoW | โ |
Logistics wild card: Strait of Hormuz insurance premiums have reportedly risen 200โ300%. 14 vessels were reported stranded as of April 1.
๐ฎ WHAT TO WATCH
| Timeframe | Key Variables |
|---|---|
| 1โ2 weeks | Official Iranian damage assessment; any repair timeline |
| 1โ3 months | If outages persist, trade flows will permanently shift to China, India, Turkey |
| Ongoing | Shipping security in the Strait of Hormuz and Red Sea |
๐ก BOTTOM LINE
For buyers in the Middle East, South Asia, and Southeast Asia:
- Secure alternative billet and flat steel supply nowย โ the window for competitive pricing may close quickly if demand shifts.
- Review freight contractsย โ force majeure clauses and insurance coverage in the Gulf region need immediate attention.
- Do not rely on Iranian supply for new ordersย โ force majeure has been declared; counterparty risk is high.
For steel producers outside Iran:
- Export opportunities existย โ but shipping risk must be factored into pricing.
๐งย amy@amyinsights.com
๐ย Download your free weekly report atย amyinsights.com