According to the public relations report of Aras Folad, Engineer Majid Zahed, in an interview with the reporter of “Felezat Online” news and analysis website, stated: Azar Poulad Aras Steel Processing Company is one of the subsidiary companies of Aras Steel Holding and has a 20-year experience in the field of processing and supplying iron scrap. has it. This complex, as the first and largest steel and cast iron recycling and processing unit among the free zones of the country, was put into operation in 2013 with a nominal annual capacity of 60 thousand tons. This company also has a development plan under implementation, the license of which was received from the Ministry of Safety in 2015, by which the nominal capacity of the complex reached 220,000 tons per year.
He added: “Due to the lack of raw materials, we operate with less than the nominal capacity and we supply four to five thousand tons of processed iron scrap monthly to steelmakers and also to Azarabadgan Steel Complex, which is one of the group companies.
Providing 70% of raw materials from foreign sources
The CEO of AzarPoulad said: Considering the geographical location of this company, which is located in the Aras Free Zone, it imports about 70% of its waste feed from Armenia and Azerbaijan and only 30% of raw materials from domestic sources.
The increase in the price of iron waste and its effect on the housing market
While pointing to the shortage of iron scrap in the world, Zahed said: the increase in the price of iron scrap and its shortage has had many negative consequences. In this way, we can say that the lack of scrap iron is one of the factors in the reduction of construction in the world and especially in Iran, which has caused stagnation in the construction industry. He further pointed to the stagnation of the iron scrap market and said: the increase in the price of iron scrap has reduced the demand of steel ingot producers for the use of iron scrap in the production process, and because the use of scrap is not economical for them, they have to use more iron. They have turned to sponge, which has caused a sudden increase in the price of sponge iron.
Reducing the demand for scrap metal
The CEO of Azar Poulad Aras further stated: Steelmakers mainly use electric arc and induction furnaces. Manufacturers who use electric arc furnaces to produce steel ingots enter their furnaces with 90-95% sponge iron and 5-10% scrap due to the increase in scrap iron prices. Currently, the market situation is such that producers are trying to use less iron scrap or increase the proportion of sponge iron to 99%.
Stating that the price of steel raw materials has become unbalanced in the last 6 months, he said: Induction plants usually use iron scrap as raw materials for their company, but currently, they have increased the share of sponge iron in furnace feed, even at the price of That their production rate, for example, should be reduced from 200 tons to 150 to 170 tons. Because scrap, due to its higher density than sponge iron, increases production if it includes most of the raw material. In addition, sponge iron does not have magnetic properties and in induction furnaces that work using magnetic force, it has a longer melting time than scrap; Therefore, it consumes more energy and has lower efficiency.
Competitive scrap market
Zahed stated: Most countries are trying to direct the scrap iron market towards them; Except for countries that do not have smelters. In fact, the scrap metal market is a competitive market. For example, Turkey bought most of the iron scrap from the war between Iraq and America, but unfortunately, our country cannot import scrap due to sanctions.
Selling at the price of the day
The CEO of Azar Poulad Aras, said about his customers: This company’s sales method is according to the market price of the day; In fact, the price of iron scrap is determined online daily. Kaveh steel companies in South Kish, Sanat Benab steel complex, Sahand steel extension, Sablan steel, Shahroud steel are among the customers of Aras steel processing company Azar Steel. We also have a record of cooperation with Pakistan.
Expansion of activity
He went on to give explanations about the company’s long-term goals and said: the main goal of Azar Poulad Aras Steel Processing Company is to increase the production capacity of the factory. To be companies helping the steel industry.
Add shredder device to collection
Mentioning the company’s short-term goals, Zahid said: This year, we intend to add a shredder to the collection in order to move further towards the mechanization of scrap metal processing. Because domestic devices are not of good quality, it is possible to supply this device through import.
The jump in the price of scrap metal
The CEO of Azar Poulad Aras, called the lack of scrap and working capital the biggest problem of the company and added: “To recycle cast iron, we need very strong financial resources because over the past five years, the price of iron scrap has grown nearly eight times.” . Naturally, we must have very high liquidity for processing.
While explaining the market situation, he said: due to the arrival of the winter season, the price of iron scrap has risen sharply and on the other hand, its supply is very low and limited. So that the companies that collect iron scraps, with the depot of these scraps, cause its price to increase. Also, due to the fact that steel factories are less willing to produce, the iron waste market is not in a good competitive position.
Supplying domestic needs is a priority
In response to the question of “Felzat Online” reporter about whether you still have export sales or not, Zahid said: “There is a shortage of scrap steel and cast iron in the country, and for this reason, the company’s first priority is to meet domestic needs.” Of course, the export of steel ingots is being carried out by other steel companies of our group and has recently exported 15 thousand tons of steel ingots to Turkey.
Lack of supervision of scrap iron market
The CEO of Azar Steel Processing Company Polad Aras emphasized: Unfortunately, in order to determine and announce a price for iron scrap to all factories, there is no union in the iron scrap market, and each company, according to the level of market demand and the volume of its deposited scrap, It determines the price, this action has a direct effect on the market in a chain and can make it turbulent.
In such a way that a factory that intends to sell its iron scrap or a company that collects scrap can have an impact on the final price of scrap. In the end, he said: it is necessary for the government to support the producers of the industrial sector in the true sense. Due to the economic issues and problems that have arisen in the country, most producers give up investing in this field.
