Iran’s cement industry grounded by non-cooperative oil, industry ministries

Business Materials 11 January 2016 17:05 (UTC +04:00)

Tehran, Iran, Jan. 11

By Mehdi Sepahvand - Trend:

At a time when cement sales are low due to a stagnant construction market, the Oil Ministry as well as the Ministry of Industry, Mines, and Trade have worsened the situation by not keeping up a contract to pay a $29 million debt to cement factories, according to Iran Cement Association Chairman Mohammad Reza Atabak.

The association is surprised by the policies of the industry ministry and in particular by that of Minister Mohammad Reza Nematzadeh, Atabak told Trend January 11.

"The ministry of industry has practically turned into the ministry of cars, for it is introducing special packages to boost production in the car industry, while forgetting to do what is necessary for mine-related industries," he said.

Atabak pointed out that cement factories have not been paid a debt of $29 million for over one year, adding that in the meantime the ministry of industry is not taking any measures to help settle the debt.

The debt comes from unpaid fuel price difference owed by the Ministry of Oil to cement factories.

The factories use gas for their furnaces. An agreement from over one year ago obliged them to use liquid fuel instead of gas in cold days when gas supply runs low. The agreement asserted that the Oil Ministry would have to pay the factories the price difference between gas and liquid fuels they use.

But, according to Atabak, the Oil Ministry owes cement factories $29 million according to a contract signed by the association, the industry ministry, and the Oil Ministry.