Final Thoughts

We’ve also talked about the war here at SMU. For example, trade attorney and SMU columnist Lewis Leibowitz spoke about the intersection between war, tariffs, and politics here.

SMU’s Stephen Miller has also written about how the war has affected the scrap export market in Turkey.

But there could be new global fallout in raw materials following hits to Iran’s steel production.

This comes as there have been recent reports that Iranian steel production has been affected following US and Israeli attacks.

An article in the Wall Street Journal highlighted that attacks on Iranian steel plants are having an impact on Iran’s wider economy. Iran said last Friday that two of its largest steel plants were damaged in attacks, affecting thousands of workers.

Additionally, a report from the UK’s Independent on Monday quoted Israeli Prime Minister Benjamin Netanyahu as saying 70% of Iran’s steel capacity has been knocked out due to the war.

While the US doesn’t use Iranian material due to sanctions, in our interconnected world, there are obviously ripple effects. Iran ranked 10th globally among crude steel producers in 2025, according to the World Steel Association. And it produced 31.8 million metric tons of crude steel last year.

With a significant impact on the world’s 10th-largest steel producer, what could be the possible trickle-down effects?

Stephen Miller weighs in on possible outcomes of a slowdown in Iran’s industry.

Miller’s take

The effect may be indirect if sustained attacks on Iranian steel assets continue, disrupting the flow of slabs and billets into the Middle East, North Africa, and Southeast Asian markets.

Another huge Iranian export is direct-reduced iron (DRI). If disrupted, it will cause increased use of alternative DRI, pig iron, or other semis. So, expect price increases beyond freight costs as more buyers try to fill their need for these materials.

In the US, this disruption will cause increased competition for the static tonnages of DRI and pig iron, which are already under pressure. DRI production in Trinidad and Tobago and Louisiana is already maxed out. Pig iron from Brazil seems to be as well.

As prices rise for pig iron and DRI or shortages occur, upward pressure will eventually be felt on prime grades of scrap, with shredded scrap along for the ride. 

Takeaways

US scrap prices have been bumping along recently. Could recent actions in Iran trigger a chain reaction that causes scrap tags to jump?

Obviously, by nature, war is unpredictable, and trying to determine the downstream impact of an already tricky situation is cloudy at best. Still, it’s important to note that what’s happening overseas can come back to hit the American market in unforeseen ways, and sometimes very fast.

Has your business been affected by the war in Iran in any way? Drop us a line at smu@crugroup.com on anything you’ve noticed. We continue to monitor the situation closely and will report on new developments as they come in. And, as always, thanks for all your support.