Energy insufficiency and self-imposed sanctions, critical challenges of steel industry

The application of steel industry in manufacturing, is one of the most substantial and influential factors in country’s economy and industry. This factor has contributed to the construction, development and enhancement of societies. Everyone can notice the presence of steel industry in his daily life since a great deal of equipment is composed of steel.

Besides, the steel industry provides job opportunities at any stage. Creation of jobs such as exploitation of steel mines, transportation, purchase of machinery and equipment, project management and training of working staff with the purpose of updating information can be named as some achievements of steel industry in our country.

Nowadays, the amount of steel production and consumption is considered as the main indicator of developed societies. The presence of steel industry in a region may have a great impact on development, culture, knowledge, job opportunities, research, education and trade. Apparently, modern life is combined with steel so the steel industry plays a pivotal role in construction, renovation and development of modern societies.

In this regard, concurrent with Azerbaijan steel association’s presence in international exhibition of investment opportunities in Iran (Iran Expo), the economy radio channel interviewed Dr. Navid Navadeh Abazar, vice president of Pars Sakhtar Industrial Group and president of Azerbaijan steel association, same part of which is reported as follows:

” Recently, shortage of energy and self-imposed sanctions are the critical challenges of steel industry that makes the annual plan’s achievements arduous. Lack of electricity and gas have taken dim view of production schedule and diminish export, whereas the previsions indicate more serious challenges in the following years that would overshadow effective and persistent presence in the exporting markets.”

According to the communication and media office of Pars Sakhtar Industrial Group, Dr. Navade Abazar stated that;

” Energy insufficiency is the fundamental challenge in Iran. As the greatest country with the richest source of oil and gas, the daily consumption on its peak is 850 million cubic meters while the estimated ideal consumption should be 1.4 billion cubic meters. This variance proves the fact enough efforts haven’t been performed by government to take advantage of energy resources. Although MAPNA is one of the greatest companies dealing with power plants, there isn’t still competent electricity production inside country that indicates ingratitude of divinity resources.

According to the development prospect of the country, the production of steel must reach 54.5 million tons in 2025, while currently we are capable of producing only 20 million tons annually. So, does the government take necessary steps to provide 54.5 million tons of steel? Of course not! These cases along with some contradictory orders and provisions made by government without consulting with private sector producers, can be known as self-imposed sanctions which is another challenge for steel production in the country.

Steel industry is one of the leading industries in foundation of economical situation and plays a pivotal role in GDP growth of private sector. There are lots of capabilities and potentials available that must be actualize. Currently, based on global ranking, Iran is ranked as the top ten producer of steel. However, we are more proficient and deserve the best.”

The CEO of Pars Sakhtar Industrial Group refers to the prospect of current position of steel industry and affirmed that the current status of steel industry is honourable and respectable especially in Northwest of Iran.

Although the Northwest region was not granted the billion-dollar investment which was devoted to central and south regions by the government, its private sector still remained as the greatest private steel producers in the country.

East Azerbaijan is the third greatest province regarding steel production, ranking after Isfahan and Khuzestan provinces which were highly supported by the governmental capitals. However, East Azerbaijan’s presence and success is honourable since the supreme leader’s statement also confirmed that the only solution for enhancement of the country is strengthening and developing private sector. Dr. Navade also remarked that the private sector could assemble and work together better than the giant companies so Azerbaijan steel association is of course greater than MOBARAKE Steel Co., which is the largest steel producer in Iran and in the Middle East.

Referring to the Iran Expo Exhibition, he maintains that: ” I managed to attend in previous Expo exhibitions and compare our country’s capabilities with other countries and I also reflect the issue via mail to the ministry but unfortunately, we did not pay the desired industrial, mineral and energy capabilities. I wish the authorities would compare the situation with other countries and recognise our weaknesses and shortcomings and endeavour to overcome drawbacks.”

The president of Azerbaijan Steel Association said that this association is composed of 80 steel manufacturing and trading companies and here we gather to increase the steel export market share of East Azerbaijan Province. Azerbaijan steel association owns more than 10 percent of steel export and nearly 25 percent of region’s per capita is generated by the private companies of this association. He hoped that via planned schedule and the cooperation of government and ministry of Industry, Mines and Trade, the country will face a significant growth in the following years. He also indicates that the majority of the members of the association are from East Azerbaijan but some producers from other provinces of Azerbaijan, West Azerbaijan, Ardebil and Zanjan are also present in this forum.

At the end Dr. Navade Abazar pointed out that 80 companies are directly working with this association and some other companies support us indirectly and there are 40 thousand employees active in this industry and we hope to eradicate unemployment in Azerbaijan region.