Domestic Raw Materials Meet 100% of Construction Demand

EghtesadOnline: Iran’s building and construction industry meets 100% of its requirements for raw materials from the local market, says Jafar Sarqeini, the caretaker of the Ministry of Industries, Mining and Trade.

News ID: ۷۵۰۹۷۱

13 September 2020

“Iran's steel, cement and tile and ceramic industries even produce more than twice the country’s domestic demand. Of the $10 billion worth of the mining sector’s exports in the last [Iranian] year [March 2019-20], exports of construction materials accounted for $7 billion. Iran is one of the major steel exporters in the region and one of the main cement exporters in the world.”

World's 10th Biggest Steelmaker

Iranian steel mills produced 16.23 million tons of crude steel during the seven months to July 31 to register a 10.8% rise compared with the corresponding period of 2019, the latest report released by the World Steel Association shows.

The country's July output stood at 2.34 million tons to witness a year-on-year growth of 14.4%, according to the Brussels-based international trade body for the iron and steel industry.

Iran remains the world’s 10th biggest crude steel producer.

The country was placed between Brazil (ninth) with 17.07 million tons of production in the seven-month period and Vietnam (11th) with 13.06 million tons.

Iran’s crude steel output stood at 31.9 million tons in 2019, according to Worldsteel, up 30.1% YOY.

More than 2.23 million tons of finished and semi-finished steel products were exported from Iran during the first four months of the current Iranian year (March 20-July 21), registering a 31.83% decrease compared with the similar period of last year, according to the Iranian Steel Producers Association's latest report.

Semi-finished steel made up 1.66 million tons or more than 74.46% of the total export volume to register a 23% year-on-year drop.

Billet and bloom had the lion’s share of semis exports with a total of 1.34 million tons to mark a 2% decline YOY. Slab followed with 322,000 tons, down 59% YOY.

Exports of finished steel products decreased by 49% YOY to reach 571,000 tons.

Long steel products had the biggest share of finished steel exports with a total of 491,000 tons (85.9%) to register a 40% YOY decline.

Rebar was the main exported product in this category with 407,000 tons, registering a YOY fall of 42%, followed by L-beam, T-beam and other types with 46,000 tons (down 32% YOY) and beams with 38,000 (down 32% YOY).

The export of flat steel products amounted to 80,000 tons during the period, indicating a YOY drop of 74%.

Hot-rolled coil grabbed the lion’s share in this category with 46,000 tons to witness a 77% decrease YOY.

Next was coated coil with 22,000 tons, down by 62% YOY, and cold-rolled coil with 12,000 tons, down 76% YOY.

More than 10.36 million tons of finished and semi-finished steel products were exported from Iran in the last Iranian year that ended on March 19 to register a 22.21% year-on-year increase.

Seventh Biggest Cement Producer

More than 17.5 million tons of cement and clinker were exported from Iran in the last Iranian year (March 2019-20), registering a 32% growth compared with the previous year, according to the head of Cement Employers Association.

“Cement accounted for 6.7 million tons and clinker for 10.8 million tons of the total sum. Our main export destinations over the period were Iraq, Kuwait, Persian Gulf littoral states, China, Bangladesh, India and Central Asian countries,” Abdolreza Sheikhan was also quoted as saying by Mizan Online.

A total of 60.3 million tons of cement and 66 million tons of clinker were produced in Iran last year, showing a 9% and 6.9% rise compared with the year before, he added.

According to Sheikhan, Iran is the world’s sixth biggest exporter of cement chain products.

“Iran's cement production capacity stands at 87.5 million tons per year,” IRNA quoted him as saying.

Iran aims to increase its cement production capacity to 100 million tons by 2021 and to 120 million tons 2025.

The country was ranked the seventh biggest producer of cement in the world in 2019, with a production of 60 million tons. It was previously the world’s eighth biggest cement producer with 58 million tons while Turkey was the seventh biggest producer with 72.5 million tons.

As Turkey reduced its production in 2019, Iran took the seventh place, Iranian Mines & Mining Industries Development & Renovation, citing United States Geological Survey, reported.

Tehran Hosts Two Exhibitions

Sarqeini made the statements at the opening ceremony of the 20th International Exhibition of Building and Construction Industry and the Ninth International Exhibition of Elevator Industry, Escalators, Elevating Conveyors, Spare Parts and Equipment, which opened concurrently at Tehran's International Fairgrounds on Sept. 10.

These exhibitions are being held under the health protocols and after securing the required permits. They are only open for visit by housing experts, while the public can join a virtual tour of the exhibitions, Mehr News Agency reported.

The two events are set to conclude on Sept. 13.

Tehran’s Construction Material Prices in Q1

The general price index of construction materials for residential properties in Tehran stood at 536.5 in the first quarter of the current fiscal year (March 20-June 20).

During the four-quarter period ending June 20, the index grew by 29.3% compared with the previous year's corresponding period, according to the Statistical Center of Iran's latest report published on its website.

Compared with the previous quarter, i.e., the fourth quarter of last year (winter), which ended on March 19, 2020, the index saw a 17.3% rise.

The construction material price index stood at 457.4 in last year's Q4.

The index rose by 31.9% during the first quarter of the current Iranian year that ended on June 20 year-on-year.

The category of “services” with a price growth of 25.8% compared with last year’s Q4 and a coefficient of 25.55% gave the biggest boost to the overall index in Q1. The index for this category stood at 435.1. The category witnessed a price hike of 27.1% compared with the previous year’s same quarter. Its price index grew by 24.7% during the four-quarter ending June 20.

"Cement, concrete, gravel and sand" ranked second in causing growth in the construction materials’ index with a price rise of 19.1% over the previous quarter and a coefficient of 15.01%. The category’s index hit 481.2 in Q1, which was higher by 34.4% compared with the same quarter of last year. During the four-quarter ending June 20, the growth rate of this category's price index was 42.7%.

The category of “ironware, rebar, profile for doors, windows and fences” was the third group with the biggest impact on the overall residential construction material price index in spring.

In Q1, the group's index stood at 611.6, which was higher by 10.8% compared with the previous quarter and 50.8% year-on-year. In the four quarters ending Q1, the group experienced a growth of 29.4% in its price index. The category has a coefficient of 18.15%.

In Q4, the categories of “glass”, “house paint” and “plasterwork” had the minimum impact on the index.

“Glass” price index stood at 460.8, which was higher by 14% compared with both the previous quarter and the same quarter of last year. In the four quarters ending Q1, the group experienced a growth of 16.9% in its price index. The category has a coefficient of 1.31%.

“House paint” price index stood at 681.6, which was higher by 8.1% compared with the previous quarter and 11.6% year-on-year. In the four quarters ending Q1, the group experienced a growth of 20.7% in its price index. The category has a coefficient of 1.5%.

“Plasterwork” price index stood at 524.4, which was higher by 19.6% compared with the previous quarter and 30.1% year-on-year. In the four quarters ending Q1, the group experienced a growth of 33.5% in its price index. The category has a coefficient of 0.96%.