Iran takes action to increase steel production

A consortium of the Iranian Organization for the Development and Reconstruction of Mines and Mines (Imidro) and five companies signed a memorandum of understanding to create a steel production group with a capacity of 10 million tonnes per year.

The move represents a clear step forward towards the long-announced plan to consolidate steel producers based in the Gulf Special Economic Zone (PGSEZ) in Bandar Abbas on Iran's southern coast. The plan was originally envisioned to create economies of scale, reduce the production costs of these companies and increase competitiveness in export markets.

“Imidro's policy is to develop large industries by the sea,” said Imidro Chairman Hodadad Garibpur. Hormozgan Provincial Governor General Fereydun Hemmati added, "Merging smaller units and developing larger units is a plan that has been implemented in China and has brought significant benefits to the country." The formation of a consortium for large industrial and mineral resources projects could mitigate the effect of economic sanctions, he added.

In addition to Imidro, other signatories include slab producer Hormozgan Steel and hot strip producer Saba Steel, subsidiaries of Mobarakeh Steel and billet producer South Kaveh Steel. Also included are Maadkoush Pelletizing Complex iron ore pelletizer and Gol Gohar iron ore miner.

The current steel production capacity at PGSEZ is 5-5.5 million tonnes per year, which will be doubled by the new consortium by 2025. The role of PGSEZ will be to provide electricity and water for the expansion.