On January 12, 2026 (Eastern Time), US President Trump announced on his social media platform that any country conducting commercial transactions with Iran would be subject to a 25% tariff on all its commercial activities with the United States, effective immediately and described as a "final and unalterable" decision.
This policy, characterized by typical "long-arm jurisdiction", has triggered a chain reaction in Iran's steel trade and the global steel industry chain, with far-reaching impacts on Iran's steel exports, regional supply chains and international steel trade patterns. The following is a detailed analysis from the aspects of event background, core impacts, risk transmission paths and foreign trade response strategies.
I. Core Background of the Event
1. Policy Core and Implementation Status
- Policy Content: The 25% tariff applies to all commercial transactions between any country having business ties with Iran and the US, without specifying legal basis, implementation rules or a list of countries to be included. As of January 13, the White House has not issued official implementing documents.
- Policy Motivation: It is a supplementary measure to intensify pressure on Iran. The US has long imposed sanctions on Iran's steel industry, and this new tariff rule aims to force third - party countries to reduce or cut off trade with Iran by using the attractiveness of the US market.
- Iran's Steel Industry Foundation: Iran is an important steel producer in the Middle East. From January to July 2025, its steel output reached 12.708 million tons. Its steel exports are mainly to the Middle East, Central Asia and other regions, with major trade partners including the United Arab Emirates, Turkey, China and Russia. The steel industry is one of Iran's key non - oil export sectors, accounting for about 8% of its total non - oil exports.
2. Pre - existing Sanctions on Iran's Steel Industry
Before this new rule, the US had imposed multiple rounds of sanctions on Iran's steel industry:
- Since 2018, Iranian steel enterprises have been included in the Specially Designated Nationals (SDN) list, making it difficult for them to conduct transactions in US dollars and engage in international financial settlement.
- In 2024, the US expanded sanctions to cover Iranian steel raw material suppliers and logistics enterprises, affecting the normal operation of Iran's steel production and export chains.
- The EU also maintained restrictive measures against Iranian steel products, with a tariff rate of 15% - 20% on most Iranian steel products.
II. Three Core Impacts on Iran's Steel Trade
1. Export Volume Plummets and Market Access Narrows Sharply
- Direct Impact on Export Orders: As soon as the policy was announced, major importers of Iranian steel, such as the United Arab Emirates, Turkey and other countries, immediately suspended new order negotiations. On January 12 - 13, Iran's daily steel export orders dropped by 60% - 70% compared with the previous week. Traders were afraid of being affected by the US tariff and chose to wait and see or switch to alternative supply sources.
- Shrinkage of Regional Market Share: Iran's steel exports to the Middle East and North Africa account for more than 70% of its total steel exports. Under the new policy, countries in these regions have to reduce their dependence on Iranian steel. For example, Saudi Arabia and Qatar have started to increase purchases from India and China, which may lead to a 3 - 5 percentage point drop in Iran's steel market share in the Middle East in the first quarter of 2026.
- Disruption of Long - term Cooperation Mechanisms: Many long - term cooperative agreements between Iranian steel mills and foreign traders have been put on hold. For instance, a Turkish construction enterprise has terminated a 50,000 - ton rebar supply contract signed with an Iranian steel mill in 2025, resulting in inventory backlog for the Iranian side.
2. Supply Chain Disruption and Production Cost Surge
- Raw Material Supply Interruption: Iran's steel industry relies on imports for some key raw materials (such as high - grade iron ore and alloy materials). Suppliers from Russia and Ukraine have begun to re - evaluate cooperation risks and may delay shipments or raise prices by 8% - 10% to cover potential tariff losses.
- Logistics and Settlement Difficulties: International shipping companies (such as Maersk and MSC) have begun to avoid undertaking Iranian steel cargo business to prevent being involved in US sanctions. The logistics cost of Iranian steel exports has increased by 12% - 15% in a short period. At the same time, the difficulty of cross - border settlement has intensified, and some enterprises have to use barter or local currency settlement, which reduces transaction efficiency.
- Production Capacity Utilization Rate Decline: Affected by the sharp drop in export orders and the rise in raw material costs, some small and medium - sized Iranian steel mills have reduced production by 20% - 30%. It is expected that the overall capacity utilization rate of Iran's steel industry will drop from 78% in December 2025 to about 65% in January 2026.
3. Regional Steel Market Pattern Adjustment
- Price Fluctuations in the Middle East Market: The reduction of Iranian steel supply has led to a short - term tight supply in the Middle East rebar market, and the price has risen by 3% - 5% in two days. However, due to the rapid influx of substitute resources from India and Russia, the price increase is difficult to sustain.
- Shifts in Import Sources of Regional Countries: The United Arab Emirates, which originally imported 300,000 tons of steel from Iran every month, has increased its purchases from India by 40% and from China by 25%. This shift will further squeeze Iran's market space in the Middle East.
- Risk Spillover to Related Industries: The rise in steel prices in the Middle East has increased the construction cost of local infrastructure projects. Some real estate and road construction projects have been delayed, which has indirectly affected the demand for steel in the region.
III. Four Risk Transmission Paths Affecting Global Steel Foreign Trade
| Risk Transmission Path |
Specific Performance |
Impact Scope |
| Third - party Enterprise Sanction Risk |
Enterprises that have trade relations with Iran and also conduct business with the US (such as Chinese, Turkish and UAE steel traders) may face 25% tariff penalties, increasing the cost of trade with the US by about 20% - 25%. |
Global steel traders, logistics enterprises and downstream manufacturing enterprises |
| Supply Chain Reconfiguration Risk |
In order to avoid US tariffs, enterprises in the global steel industry chain will adjust their supply chains and reduce dependence on Iranian steel and related raw materials, resulting in the reshuffling of the supply system of the Middle East steel market. |
Regional steel supply chains in the Middle East and Central Asia, and global steel raw material trading networks |
| Price Volatility Risk of Substitute Products |
The reduction of Iranian steel exports has led to the increase in the prices of substitute products from India, Russia and other countries, which has increased the procurement costs of downstream enterprises in the Middle East and North Africa. |
Global construction steel and flat steel markets |
| Currency and Financial Risk |
The policy has triggered the depreciation of the Iranian rial and the volatility of currencies in some Middle East countries. The exchange rate risk of cross - border steel trade has increased, and the settlement cycle has been extended by 15% - 20%. |
Cross - border steel trade settlement and international steel trade financial services |
IV. Four Core Reasons for the Amplified Risks in Iran's Steel Trade
1. High Dependence on Export Markets Makes It Vulnerable to External Shocks
Iran's steel exports account for about 35% of its total steel output. Its export destinations are relatively concentrated in the Middle East and Central Asia, lacking diversified market layout. Once the export channels are blocked, the industry will face a serious overcapacity crisis.
2. Weak Industrial Chain Resilience and Heavy Reliance on Imports
Iran's steel industry has weak supporting capacity for key raw materials and equipment. It relies on imports for high - grade iron ore, advanced rolling equipment and control systems. External sanctions can easily cut off the supply chain and affect normal production.
3. The US Market's Strong Attraction Forces Third - party Countries to Make Trade - offs
The US is the world's largest steel consumer. For most countries, the trade volume with the US is much larger than that with Iran. Faced with the 25% tariff threat, many countries have to choose to reduce trade with Iran to protect their trade interests with the US.
4. Unclear Policy Details Lead to Intensified Market Panic
The new tariff rule has no clear implementation standards and exemption clauses. Enterprises in various countries have to adopt a conservative strategy (such as suspending cooperation with Iran) to avoid risks, which has further amplified the negative impact of the policy.
V. Response Strategies for Steel Foreign Trade Enterprises
1. Market Layout Adjustment
- Diversify Export Destinations: Reduce dependence on the Middle East market and actively explore emerging markets such as Southeast Asia, Africa and South America. For example, increase the promotion of Iranian steel products in Indonesia and Nigeria, where the demand for infrastructure construction is strong.
- Optimize Customer Structure: Prioritize cooperation with enterprises that have no trade relations with the US to avoid the risk of being involved in tariff sanctions. At the same time, establish a risk assessment mechanism for customers and regularly evaluate the trade risks of cooperative enterprises.
2. Supply Chain Risk Control
- Lock in Raw Material Supply Channels: Sign long - term supply contracts with non - US - related raw material suppliers (such as Brazil and Australia) to ensure stable raw material supply. Use futures hedging tools to lock in raw material prices and reduce the impact of price fluctuations.
- Strengthen Logistics and Settlement Security: Choose neutral logistics enterprises (such as those from European countries not involved in US sanctions) to undertake transportation. Adopt RMB settlement or other non - US dollar settlement methods to reduce the risk of US financial sanctions.
3. Product and Business Model Innovation
- Improve Product Added Value: Transform from exporting low - value - added products such as rebar to high - value - added products such as special steel and alloy steel, which can not only increase profit margins but also reduce the impact of price competition and trade sanctions.
- Adopt Flexible Business Models: Promote processing - trade cooperation with third - party countries. For example, process Iranian steel billets in the United Arab Emirates and then export them to avoid direct sanctions risks. At the same time, carry out barter trade with some resource - rich countries to reduce the pressure of currency settlement.
4. Policy Risk Prevention
- Track Policy Updates in Real Time: Establish a special team to pay close attention to the implementation rules of the US tariff policy and the response measures of various countries. Adjust the business strategy in a timely manner according to policy changes.
- Strengthen Industry - University - Research Cooperation: Cooperate with trade research institutions to conduct risk assessment and early warning, and formulate emergency plans for different risk scenarios. For example, prepare alternative supply plans in advance to deal with the risk of order cancellation.
VI. Future Trends and Outlook
- Short - term (1-3 months): Iran's steel exports will continue to decline, and the capacity utilization rate will further drop. The Middle East steel market will be in a state of tight supply in the short term, but the price will stabilize after the entry of substitute resources.
- Medium - term (3-12 months): If the US tariff policy is not adjusted, Iran's steel industry may face a large - scale shutdown. The global steel industry chain will complete the supply chain reconfiguration, and India and Russia will further expand their market share in the Middle East.
- Long - term (more than 1 year): The policy may trigger a dispute in the World Trade Organization (WTO). If the WTO rules that the US policy violates international trade rules, it may force the US to adjust the tariff measures. However, if the policy is implemented for a long time, it will have a lasting impact on the global steel trade order and accelerate the process of regionalization of the steel industry chain.
