We estimate average cash costs for Iranian iron ore concentrate exports of US$50.50/tonne (FOB vessel), which is approximately breakeven at 2016 prices. Our cost estimate is at the higher end of the Wood Mackenzie global cost curve primarily due to inefficient processes, high transport costs and a lack of water. We forecast Iranian concentrate exports to decline over the next few years as competition in the seaborne market intensifies. A lack of iron ore pellet capacity is a bottleneck for Iran. There are a large number of pellet plants in various stages of construction but a lack of funds has stalled their development. In order to expand capacity in its iron ore sector, Iran needs to attract foreign investment but, despite the lifting of sanctions, we think this will be a long and difficult process as investors tread cautiously in a highly risky market.