Iran production capacity at 55Mt

Iran production capacity at 55Mt
Published: 05 January 2009

While attending the inauguration of a new cement production line in Hamedan Province, Ali Akbar Mehrabian, Minister of Industries and Mines has announced that Iran has reached self-sufficiency in cement production, Fars News reported. According to Mehrabian Iran is now capable or producing 55Mt of cement domestically each year and he expects the country’s production capacity to hit 64Mt by the end of the current fiscal year, which ends in March. Mehrabian further noted that over the last three years cement production has increased by 8Mta and hopes that the country will begin exporting cement in the next few years.

 The figures quoted by the minister are notably higher than the most recent estimates from the United States Geological Survey, which put Iran’s cement production capacity at 34Mt in 2007.

Iran has been steadily increased its production capacity for materials like cement and steel as its domestic housing market has taken off. President Mahmoud Ahmedinejad has spent significantly on domestic infrastructure projects, and regional construction growth boomed along with soaring oil prices.

Now that growth across the MENA region has begun to subside, growth in the domestic housing market shows signs of cooling, and a number of industrial projects are delayed or cancelled as a result of the sharp correction seen recently in global oil prices, expansion of raw material production capacity will most likely be put on hold. The president’s proposed overhaul of the nation’s subsidy system could also dampen growth in raw materials industries like cement, which are accustomed to extremely cheap electricity prices.