Economy, Business And Markets

Falling Iron Ore Prices: Blessing in Disguise

Falling Iron Ore Prices: Blessing in DisguiseFalling Iron Ore Prices: Blessing in Disguise

Iron ore exports in the first four months of the current Iranian year (started March 21) dropped 34% in terms of volume and 65% in value compared to last year’s similar period, amid plummeting global iron ore prices.

According to the Islamic Republic of Iran’s Customs Administration, more than three million tons of high purity hematite iron ore worth about $121 million were exported to China, the United Arab Emirates, Pakistan, Turkmenistan, Slovenia, Turkey and Germany during the four-month period.

“The drop in global iron ore prices has actually helped the domestic industry, as we have to gradually stop the export of unprocessed iron ore and establish iron ore concentrate and pellet production units to fully utilize our potential and produce high value-added products,” ISNA quoted chairman of Iran House of Industries, Mining, and Trade, Abdolvahab Sahlabadi, as saying.

The official recently announced that unprocessed iron ore exports will be banned by the end of the current Iranian year (ending March 19, 2016) in a bid to support the domestic industry.

Explorations made in the 1960s estimated Iran’s iron ore reserves at about 5.1 billion tons, of which 2.8 billion tons are proven. But most of Iran’s iron ore is low grade and needs to be converted to pellets to be used by steelmakers. Iran produced only 21 million tons of iron pellets last year while demand reached 28 to 29 million tons.