Although the industry minister recently announced that the price of industrial commodities would not be affected by the hike in fuel costs, officials of Iran Cement Industry Association have pleaded the ministry to increase cement prices by 17%, claiming that the sector is not able to survive at current prices.
Recently, the government revoked monthly subsidized quotas of cheaper fuel and is now selling it for a single price of 10,000 rials (30 cents). However, Minister of Industry, Mine and Trade, Mohammad-Reza Nematzadeh said last week that the cost of energy supplied to industries such as steel and cement will remain unchanged, ISNA reported.
Meanwhile, secretary of Iran Cement Industry Association, Abdolreza Sheykhan, believes although the cost of energy supplied to the cement factories is to remain unchanged, the hike in fuel prices would lead to a surge in production costs due to increased cost of transportation. “Trucks carry raw materials from mines to factories and transport the finished products to various destinations. Therefore, the increased transportation costs will affect the prices considerably,” he said.
After an approximately 5% drop in cement exports in the past Iranian calendar year (ended on March 20), the sector is now expecting tougher days ahead as government authorities seem adamant to oppose any increase in cement prices. Over the past few years, whenever fuel prices hiked in Iran, the prices of basic commodities followed suit.
