H1 Cement Production Rises 14% YOY to Over 35m Tons

EghtesadOnline: Iran' cement production in the first six months of the current fiscal year (started March 20) reached 35.63 million tons, which shows an increase of 14.4% compared with the same period of last year.

News ID: ۷۵۱۵۱۸

18 November 2020

According to data released by the Ministry of Industries, Mining and Trade, Iran produced 31.15 million tons of cement in H1, Mehr News Agency reported.

The country's cement production capacity is 85 million tons, of which 65 million tons are consumed domestically.

According to the Islamic Republic of Iran Customs Administration’s latest data, in the first five months of the current Iranian year, Iran exported 5.84 million tons of cement worth $127.9 million to 28 countries.

India, Afghanistan, Russia, Iraq, Qatar, Kenya, Kuwait, Sri Lanka, Pakistan, Armenia, Turkmenistan, Kazakhstan, Azerbaijan, Bangladesh, China and Oman were main export destinations.

According to Abdolreza Sheikhan, secretary of Iran's Cement Association, exports of cement saw a 24% decrease over the five months ending Aug. 21 which is to blame for the decline in demand from neighboring countries, particularly Iraq.

As of March 2018, Iraq used to be the main export destination of Iranian cement but it is more than a year now since the neighboring country has suspended imports of this essential building material from Iran.

“With the help of European countries, Iraqis established factories with a production capacity of 40 million tons of cement and no longer need Iran’s cement,” said Hamid Hosseini, a senior member of Iran-Iraq Chamber of Commerce.

“At first, they increased cement import tariffs and then imposed an occasional ban. At present, Iraq is only purchasing clinker from Iran.”

Sheikhan noted that costs associated with the production of clinker are very high for regional countries, because of which they prefer to import rather than produce the item.

“Iraq used to account for 30% of Iran’s cement exports. Today, Afghanistan is the main importer of cement from Iran; Afghanistan pays between $50-60 per ton for the import of cement from Pakistan compared with $25 per ton from Iran, plus transportation and customs duties. Five-month exports of cement to Afghanistan reached 584,000 tons,” he said.

More than 17.5 million tons of cement and clinker were exported from Iran last 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, the littoral states of Persian Gulf, China, Bangladesh, India and Central Asian countries,” Sheikhan was 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.

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

As Turkey’s production decreased in 2019, Iran occupied the seventh place, Iranian Mines & Mining Industries Development & Renovation, citing the United States Geological Survey.

A bulk clinker transportation rail line was recently launched in the southern Khuzestan Province’s Shalamcheh border crossing.

“Through this rail line for bulk clinker transportation, we estimate that exports of the commodity from Arvand will reach a total of 3 million tons by the end of the current Iranian year on March 20, 2021,” deputy head of Arvand Free Trade Zone for Investment and Business Expansion Affairs, Ali Mousavi was quoted by IRNA as saying.

The official added that Iran exports around 12 million tons of clinker every year and Iraq is the biggest export destination.

“Prior to this loading and unloading of clinker used to take place in Khorramshahr Port which had caused environmental hazards.”