Economy, Business And Markets

Iropex Confab to Unveil Iron Ore Strategic Document

Iropex Confab to Unveil Iron Ore  Strategic DocumentIropex Confab to Unveil Iron Ore  Strategic Document

The second international conference on iron ore will unveil a strategic planning document on the future of the iron ore industry; Fooladnews quoted a member of Iron ore producers and exporters association of Iran (Iropex) as saying.

Sajjad Ghoroqi expressed hope that the conference will help the iron ore industry overcome the current challenges mainly caused by the imbalance between supply and demand in the global market.

The strategic document emphasizes that iron ore export development should be in tandem with completion of the value-added chain, said the Iropex member ahead of the conference due to be held on November 30.

The fierce competition between major global iron ore companies has caused sharp drops in global prices, which have also hit the smaller iron ore mines.

 Lower-grade iron ore mines and the mines with low production rates have suffered from low prices, not only in Iran, but all over the world.

Iron exports in the Iranian month of Mehr, which ended October 22, showed a large decrease of 86% compared to the same month last year, reported on November 6 based on the latest report by the country’s Customs Administration.

During the month, the country exported 1.9 million tons of iron ore worth $13.2 million. That is while during the first seven months of the Iranian year, which started March 21, some 11.9 million tons of iron ore were exported worth $741.5 million.

During the past Iranian year, which ended March 20, the export of iron ore reached new highs, whilst also for the first time topping the list of non-oil exports for a few months.

But this year, the export dropped due to global low prices and the export duties imposed by the administration.

Ghoroqi warned that small iron ore mines, which are mainly owned and operated by the private sector, are highly dependent on exports in order to develop and the current situation could leave them with no option but to close down.

Over the past two years, the government imposed a tax of up to 40% on iron ore exports, taking advantage of a surge in sales to China, to replace revenue from oil and other sources that have been hit by sanctions.

 Iran’s revenue from exports of oil and other goods has decreased since the United States and the European Union imposed economic sanctions in an effort to pressure Tehran over its nuclear energy program.

After President Hassan Rouhani took office last year, the ministry of industry, mine, and trade began to reverse the previous policies towards iron ore export duties by significantly reducing the rates and completely removing them in the end.

Industry and steel officials say by launching numerous steel plants, iron ore concentrate and iron ore pellet manufacturing units Iran will not have to export raw materials over the next two years.

Currently, another 14 million metric tons of iron ore concentrate is expected to be added to the annual production capacity, which should be used by the iron ore concentrate plants, otherwise it will be exported.