The President of the Steel Producers Association Reveals the Battle That Transformed the Steel Industry

According to the news website ” Madan Nameh “, the Iranian Steel Producers Association is now one of the country’s most reputable and influential economic organizations. However, this association has gone through a long and steep path to reach its current position.

Bahram Sobhani, the head of the Steel Producers Association, explained the organization’s early years of activity on the occasion of its founding anniversary.

According to him, the country’s steel industry faced a serious structural dilemma in the 1970s.

On the one hand, the Isfahan Steel Works, as a large state-owned complex, produced the main part of the country’s steel. On the other hand, the newly established private units were struggling with various problems.

The Crisis of Duality: The Background for the Formation of the Steel Association

Referring to the inequalities of that period, Sobhani said: “Isfahan’s iron smelting was under pressure from mandatory pricing policies.”

The company was forced to offer its products at low prices.

In contrast, private sector producers were importing the raw materials they needed due to a shortage of ingots.

However, these units could not sell their products at a price higher than the government iron smelting rate.

As a result, the continuation of these conditions resulted in definite losses for the private sector.

State-owned companies were also not allowed to protest.

The head of the Steel Producers Association explained that state-owned companies could not object to government policies either.

The reason for this situation was clear: the government simultaneously played the role of owner and policymaker.

This structural impasse led steel producers to create a professional organization.

Industry activists concluded that the only way to defend common interests was to form an independent trade union.

This organization could be the voice of the producers’ union. It would also provide the opportunity for formal negotiations with the government and ministries.

Finally, this idea came to fruition in 2002.

In the same year, several key producers laid the foundation stone for the Iranian Steel Producers Association.

Tackling command pricing

Sobhani considered reforming the pricing mechanism to be the association’s most important achievement in its first years of activity.

According to him, the association’s first mission was to use an official platform to defend the interests of its members.

During that period, the gap between the selling price of iron ore and the free market rate had more than doubled.

This discrepancy had caused widespread problems in the steel market.

Therefore, the association, through continuous follow-up, proposed the creation of a transparent mechanism for price discovery.

Launching a metals exchange

The association’s pursuits ultimately led to the launch of the metals exchange.

After this change, manufacturers were able to offer their products in a transparent environment.

Also, instead of mandated prices, the market margin price became the basis for trading.

This development played an important role in the transparency of the steel market.

The Metals Exchange continued its activities and became a commodity exchange.

Sobhani considered this change one of the association’s greatest services to the country’s economy and steel industry.

Changing mission statements over time

The head of the Steel Association said the industry’s challenges have become more complex in recent years.

For this reason, the association’s missions have also changed.

Today, steel producers face problems such as power and gas outages during peak consumption periods.

Restrictive export policies have also made it difficult for companies to operate.

In addition, sudden exchange rate fluctuations affect the cost of production and planning of firms.

In such circumstances, the association tries to defend the interests of its members.

Demanding in the field of energy and exports

Sobhani emphasized that making demands in the areas of energy, exports, and foreign exchange is no longer an option.

These measures have become a necessity to continue production.

The Steel Association, on behalf of the producers, is also following up on these issues with the responsible agencies.

The main goal is to reduce pressure on production units and prevent disruption to factory operations.

The association grew from 10 members to over 150 producers.

The head of the Steel Producers Association also pointed to the quantitative and qualitative growth of this organization.

This association began its activities in 2002 with 10 members.

Now more than 150 steel producers are members.

This growth shows that the association has been able to gain the trust of a large portion of steel industry activists.

The Iranian Steel Producers Association now operates under the supervision of the Iranian Chamber of Commerce.

Also, this complex is known as one of the top trade associations in the country.

Being among the top organizations in the country

Sobhani finally referred to the assessments of the Iranian Chamber of Commerce.

According to him, the Chamber of Commerce continuously evaluates the performance of trade associations.

The results of these assessments show that the Steel Producers Association has always been among the top organizations.

The president of the Steel Association considered this position to be the result of the trust of the members.

He also emphasized the role of the association’s continuous efforts in defending the rights of producers.

Conclusion

The Iranian Steel Producers Association was formed in response to structural problems in the steel industry.

Countering price manipulation and helping to launch the metals exchange were among the most important actions of the organization’s early years.

Over time, issues such as energy supply, export policies, and currency fluctuations became the focus of the association’s activities.

The growth in the number of members from 10 units to more than 150 producers also indicates the expansion of this organization’s position in the country’s steel industry.