Entry of iron ore in the commodity exchange, principled support of the mining industry / 8,600 billion tomans subsidy to steelmakers from the sale of concentrate in the first 6 months of this year

The Deputy Chairman of the Iran Chamber of Mines, while announcing his support for the government’s policy in organizing the steel chain, considered the entry of iron ore in the commodity exchange as a principled support for the mining industry.

According to the economic observation and quoting the mine letter, Sajjad Gharghi stated: Iron ore is in three categories of granulation, concentrate and pellets, in which concentrate and pellets can be offered in the stock market, but granular iron ore depends on its nature for Supply in the stock market is not suitable because granulated iron ore has a great variety in grade and there is a range of 40 to 62%, in addition to the annoying elements such as sulfur, phosphorus, etc. in each is different, which ultimately makes the standardization of these products difficult Be.

Referring to another problem in the supply of iron ore in the Commodity Exchange, he said: “Iran Commodity Exchange Company is a private company, some of whose board members are steel, and this issue causes concern among mining activists that sabotage of supplies is کردن. One of the main goals of offering products on the stock exchange is fair price discovery and the other is to create transparency in transactions, and therefore the supply of raw materials for steel production and of course the entire production chain in the commodity exchange contributes to price transparency of these goods. The company’s board could have made things better.

He went on to point out the price hikes that have taken place in the mining sector and added: “Currently, if we consider the price of concentrate at $ 188, $ 30 shipping costs and $ 2 port costs, as well as the average shipping cost equivalent to 8 mines.” Deduct $ 10 from it, concentrate minus shipping and port shipping and other costs, should be sold at a price of $ 146, if according to the order price in the chain, this concentrate is equivalent to 16% of steel ingots Khuzestan is priced, Khuzestan ingot has been priced at 10 thousand 445 Tomans per kilo last month, based on which the concentrate is priced at one million and 671 thousand Tomans. While the calculated $ 146 is initially deducted from the expenses, including the Sanai dollar with the number 25 thousand and 500 tomans, equivalent to three million and 723 thousand tomans. That is, the miner sells one million and 671 thousand tomans instead of selling his product for 3 million and 723 thousand tomans in the mine. In fact, the producer receives only 44% of the actual price of its product, which is 56% of the actual price of the subsidy that the mining sector gives to the steels.

The Deputy Chairman of the Iran Chamber of Mines Commission explained: According to calculations from the financial statements of large mining companies such as Gol Gohar and Chadormelo in the first six months of the year, the equivalent of 8,600 billion tomans has been given to steelmakers only from the sale of concentrate. This rent due to the cheap sale of concentrate has caused losses for mining companies. These amounts indicate the reason for the steelers’ insistence on not accepting the notification procedure. According to the mentioned method, the base prices of 80% of the world prices are to be considered and the competition is also free. The same amount is suitable for the prices of iron ore, concentrate and pellets, because now these products are in favor of the ingot ring and in an orderly manner. It is sold at 50% of the world prices and cheaper, and by offering it on the stock exchange and the above-mentioned pricing method, it helps to repair the price gap and suppression and leads to competitive prices. In terms of transparency, full offerings on the commodity exchange will determine what sets, what products and to what extent they produce that steel sets used to have because of the subsidies they had to buy cheap inputs and raw materials, now They are against this paragraph of the procedure and the issue of offering iron ore in the commodity exchange. Of course, at present buyers of steel minerals are themselves members of the board of directors of the Iran Commodity Exchange, and our goods should go on the exchange, not the exchange that is the buyer’s hand, and in these transactions the buyer should not be decisive. This is the right of both parties. To have equal conditions in these transactions.

Shiva Nick Duty