Koblenz, Germany - A 63-year-old German businessman who allegedly sold 16 tons of graphite to Iran denied at this trial Wednesday that the substance was to make rocket nozzles.

He told a state superior court in Koblenz, Germany that he rejected all 12 counts of the indictment.

He is accused of breaking laws preventing illicit arms exports by declaring the graphite exported from 2005 to 2007 to be low grade.

This would have avoided the need to apply for a government clearance which would almost certainly have been refused.

German intelligence suspects the graphite was bought for Iran's missile programme. Tehran is suspected of secretly developing nuclear weapons which could be delivered as the payload of the missiles.

The accused was chief executive of a firm that specialized in trading graphite.

In 2007, Germany imposed a ban on exports of any graphite, even the low-grade type, to Iran.

Technical books say rocket nozzles are often made of graphite, which is a form of carbon.

Prosecutors said in February that the material was exported through a Turkish intermediary. Alert Turkish customs officers stopped a further 10 tons of graphite being trucked into Iran.

The man has been in custody since last June.

His name has been withheld under privacy guidelines applied by the German media.  (dpa)