Iran, Turkey Endeavor to Walk the Mineral Talk

EghtesadOnline: Iran-Turkey Mineral Cooperation Commission has been formed for introducing Iran’s mineral reserves and products to the Turkish side and explore third party countries they can jointly target.

News ID: ۷۴۶۵۷۲

28 January 2019

“Mining is a highly capital-intensive sector. Therefore, the norm is for different companies to form joint ventures, wherein each business shoulders part of the responsibility and expenses. We in Iran need investments for exploration and processing of minerals. The bulk of our mineral products are sold as raw materials," Jalal Ebrahimi, the head of the commission, told Financial Tribune.

"On the other hand, the neighboring Turkey is in need of minerals such as iron ore, coal, pellets, concentrates, copper, zinc, molybdenum, chromite and fluorine, to name a few, for its metal industries. The two countries can complement each other and create value-added manifold through mineral cooperation.”

Ebrahimi, who is also the secretary-general of Iran-Turkey Chamber of Commerce, noted that the chamber formed this commission in collaboration with Iran Mine House and Iran-Turkey Studies Center to attract Turkish investments and encourage cooperation in the mining sector, Financial Tribune reported.

“This will benefit both countries. The products of this cooperation can be exported to third party countries in Europe, the Commonwealth of Independent States and the African region. If this mineral cooperation progresses as expected, we can easily reach the $30 billion annual trade figure targeted by the two countries,” he said.

Iran's President Hassan Rouhani visited Turkey in December 2018.

In a joint statement issued at the end of the fifth meeting of Iran-Turkey High Council of Strategic Cooperation in Ankara, the two sides supported efforts aimed at raising annual bilateral trade to $30 billion from the current $11 billion.

They stated that this target can be achieved by providing further support to the joint economic commission, carving out new areas of cooperation, creating an environment more conducive to investment, facilitating the transit of goods and engaging the private sectors of the two countries, the Iranian president’s website reported.

Ebrahimi noted that the commission will help bring Iranian and Turkish miners and mine owners together in specialized committees where they can get to know each other as well as their products and services.

“Iran’s mineral products and capacities are unknown to the world. We have, for instance, high quality construction stones of unique colors. We, in the commission, plan to set up a multilingual site for introducing all the varieties in the area in detail to potential customers and investors," he said.

"We also intend to launch an exhibition of Iran’s mineral products in Turkey where people active in the field can get their preliminary information and see samples of products firsthand without needing to travel all the way to the mine.”

Iran is home to 68 types of minerals with more than 37 billion tons of proven reserves and 57 billion tons of potential reserves.

According to the United States Geological Survey, Iran holds the world's largest zinc, ninth largest copper, 10th largest iron ore, fifth largest gypsum and barite, and 10th largest uranium reserves.

Overall, Iran is home to more than 7% of global mineral reserves.

According to Ebrahimi, the Turks have state-of-the-art machinery that can add a higher value-added to Iranian raw materials.

"Businesses from Turkey are already active in Iran’s gold and coal mines as well as copper and zinc industries. Plans are underway to expand this to other mineral products," he said.

The official said the joint commission will hold a B2B forum for Iranian and Turkish miners in the near future to kick-start serious activity in this respect.

The commission also intends to form a specialized committee of Iranian postgraduate and PhD holders in different mining majors, which will work on exporting technical and engineering services in the field.

Minerals Top Iran’s Exports to Turkey

Mineral products constituted the largest share of Iran's exports to Turkey during the first eight months of the current Iranian year (March 21-Nov. 21).

Data released by the Islamic Republic of Iran Customs Administration show 1.24 million tons of non-oil commodities worth $959.16 million were exported from Iran to the neighboring country, down 67.06% and 32.92% in tonnage and value respectively compared with the preceding year's corresponding period.

In fact, Turkey was Iran’s sixth biggest export destination in the world.

According to an IRNA report, Iran exported 441,311 tons of mineral products worth $404.6 million to Turkey during the period.

Mineral exports had a 45% share in Iran's overall exports to the neighboring country.

Ferroalloy, ceramics, aluminum and alumina powder, coal, coke, titanium, zinc, lead, cement, chrome, molybdenum and different types of rocks were the main exported minerals.

Among the mineral products, zinc topped the list of exports with 38,700 tons worth $110.9 million, followed by aluminum products with 41,200 tons worth $85 million and steel products with 138,800 tons worth $74.5 million.

Precious metals and stones had the lowest shares in Iran’s mineral exports to Turkey during the period.

Iran also imports certain mineral products from Turkey. Steel had the largest share of imports from the neighboring country during the same period with 62,000 tons worth $53.6 million, followed by zinc with 82,800 tons worth $23.2 million and metal industries with 4,600 tons worth $14.7 million.

Mineral Trade Surplus

Iran's trade surplus of mineral products increased notably to $4.58 billion, the latest report released by the Iranian Mines and Mining Industries Development and Renovation Organization reviewing the same eight-month figures shows.

Iran exported 39.88 million tons of mineral products worth over $6.87 billion, down 10% in tonnage and up 7% in value compared with last year's corresponding period.

Imports stood at 2.57 million tons worth $2.29 billion, dropping 36% in tonnage and 27% in value year-on-year.

IMIDRO's previous report showed Iran registered a trade surplus of $3.8 billion for the first seven months of the current fiscal year (March 21-Oct. 22).

Steel, mainly semi-finished, had the largest share of both imports and exports of mineral products.

Khouzestan Steel Company was the top mineral exporter during the eight months. The Ahvaz-based factory exported more than $705.29 million worth of mineral products.

Esfahan Steel Company was the second major mineral exporter with over $326.59 million, followed by Mobarakeh Steel Company with more than $309.77 million, Iran National Copper Industry Company with 309.19 million and Hormozgan Steel Company with 202.99 million.

As for imports, Esfahan Steel Company was the top importer of mineral products during the period, having imported 137.25 million worth of mineral products. Mobarakeh Steel Company was the second major importer with more than $59.98 million, followed by Geno Ferro Alloy Company with $58 million, Iranian Aluminum Company with $33.49 million and KSC with over $24.94 million.