Azerbaijan remains a relatively small steel-consuming market compared with major regional players such as Kazakhstan and Uzbekistan, but steel demand has been steadily increasing following a period of economic stagnation. Total metal consumption in the country is estimated at around 1.7–1.8 million tonnes, while per-capita consumption has exceeded 150 kg.
The outlook for long steel products is particularly positive. MMITC estimates that consumption of rebar, wire rod, small-section structural products and rounds could grow at an average annual rate of more than 4% through 2035. The expansion is expected to be driven by Azerbaijan’s industrial development programs as well as large-scale construction and infrastructure projects.
Rebar dominates long steel consumption
Rebar remains the largest segment of Azerbaijan’s long steel market. Domestic rebar production reached approximately 440,000 tonnes in 2024, broadly in line with MMITC’s estimates. Including imports, consumption across the long-product segments covered by the study exceeded 600,000 tonnes, with a notable increase recorded in 2025.
The market is led by Baku Steel Company, which operates two steelmaking furnaces and is also the parent company of seamless pipe producer Azerboru. Around eight other companies operate across the relevant long-product segments, creating a relatively competitive environment for a market of Azerbaijan’s size.
On the import side, Russia, Iran and Türkiye are the main suppliers. Their strong position is largely explained by geographical proximity and logistics. The trading sector itself remains relatively concentrated, with only around four to five companies handling significant volumes.
Azerbaijan maintains support for domestic producers
The Azerbaijani government has taken measures to protect and support domestic steel production. A 150-manat duty on rebar is currently in place, although its application includes certain exceptions and specific conditions.
Domestic production, however, remains dependent on imported raw materials and semi-finished steel. Azerbaijan currently has no operating iron ore mines or DRI production, while the country also lacks facilities for flat steel production.
Domestic collection of ferrous scrap is estimated at approximately 550,000–580,000 tonnes per year. Additional requirements are met primarily through imports of billet and finished steel products.
Dashkesan project could transform the raw-material base
One of the most important potential developments for Azerbaijan’s steel industry is the planned development of the Dashkesan iron ore deposit, which is being advanced by state-owned AzerGold.
As of 2026, the project has completed a bankable feasibility study, with plans for a DRI plant based on Danieli technology. The deposit contains high-grade iron ore but presents technical challenges because of the complexity of the ore.
The project is expected to require substantial investment. If successfully completed, it could significantly strengthen Azerbaijan’s domestic steel value chain by providing locally produced iron units for steelmaking.
The planned DRI facility is expected to have a capacity of around 500,000 tonnes, and there is potential for the project to eventually be integrated with Baku Steel Company.
Infrastructure projects to remain key source of demand
Azerbaijan’s steel consumption is traditionally concentrated in construction and the oil and gas sector, but the demand structure is gradually broadening.
Infrastructure development, renewable energy projects, modernization of electricity networks and large-scale reconstruction programs are becoming increasingly important sources of steel demand.
The ongoing development and reconstruction of Karabakh and Zangezur, metro expansion, road construction, airport modernization and energy infrastructure projects are among the initiatives expected to support future consumption.
Rather than relying solely on GDP forecasts, MMITC used a bottom-up methodology, assessing individual projects according to their financing, implementation probability, timing and expected steel intensity. This approach was used to develop several demand scenarios and identify the segments with the strongest growth potential.
Wire rod and structural products expected to grow fastest
While rebar will remain the dominant product, wire rod and small-section structural products (SQB) are expected to record the fastest growth rates.
Construction, transport and infrastructure are projected to remain the largest sources of demand. At the same time, the structure of Azerbaijan’s rebar consumption differs from other regional markets, partly because of seismic considerations and the country's transition from Soviet-era GOST standards toward European standards, supported by its close economic ties with Türkiye.
Import opportunities remain
Despite its relatively small size, Azerbaijan offers opportunities for foreign steel suppliers.
Rebar imports, which exceeded 150,000 tonnes in 2020, have declined considerably in recent years. Meanwhile, wire rod imports are estimated at around 40,000–60,000 tonnes, while structural-section imports are believed to be up to 15,000 tonnes annually.
Imports of construction-grade rolled products are estimated at roughly 2,000 tonnes per year, with Russia accounting for approximately 99% of these supplies.
For foreign producers looking to enter the market, understanding individual importers, supply volumes, pricing strategies and customer segmentation will therefore be more important than simply assessing Azerbaijan's overall market size.
Positive long-term outlook
Azerbaijan’s steel market is entering a period of further development as infrastructure spending, reconstruction, energy investment and industrial projects generate additional demand.
Although the country remains dependent on imported billet and other raw materials, the potential development of the Dashkesan deposit and a domestic DRI facility could gradually reduce this dependence and create a more integrated steel production chain.
With long-product consumption expected to grow by more than 4% annually in the base-case scenario through 2035, Azerbaijan is likely to remain a relatively small but increasingly relevant market for regional steel producers and exporters.
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