“We’re going to start the new plan of the Ministry of Industry, Mine and Trade regarding the new premium discovery contracts for mining products in Iran’s commodity exchange market.” Said the deputy of the Ministry of Industry, Mine and Trade, “With this method, the market will be predictable for both the producer and the consumer, and there will be the possibility for long term plans in production. Actually with this method, one of the biggest obstacles in the way production, which is the inability to predict for the short term and midterm plans, will be removed. It is a huge step in production.”
According to the Mining
Investment Insurance Corporation’s report, Mohammad Sadegh Mofateh said about
the Ministry of Industry, Mine and Trade’s new plan regarding the premium
discovery contracts in smart management of Iran’s commodity exchange market and
putting the producers’ minds at ease, “the logic behind these contracts is that
both the producer and the consumer can plan for a year’s efficiency and they can be sure about the future of the
market, sales and providing their raw materials. With this new plan, the
Ministry of Industry, Mine and Trade, using the exchange market’s potentials,
will make the market predictable for producers.”
About signing long-term contracts, Mr. Mofateh continued: “with this
method, when a production unit presents its product for a period of six months,
or a year, there would still remain some products, and after covering the
domestic market’s needs, the producer can start exporting the remained products.
In other words, the producers can plan for exportation, and so when a company
knows how much it has to product to cover the domestic market and export, it can
plan better for its production, and this could be an advantage for producers.”
“On the other hand, downstream industries can purchase the raw material they
need for six months and come to a better production with a better planning, and
won’t be worried about the market’s fluctuations. With this method, the market
would be predictable for both the producer and the consumer and the producers
can have midterm and long term planning.”
The Industries Welcoming the New Plan
“We have just started this plan in the exchange market, and when the
industries get familiar with it, we’ll see them welcoming it.” Said Mr.
Mofateh, emphasizing that the industries will hugely welcome this plan, “I
emphasize, with this method, the client is sure about having the raw material
they have bought, and the producer is also sure about selling their products in
the future, and the remains of their products will be exported. This will bring
a stable and relaxed atmosphere in the market and both the consumer and the
producer will welcome this plan.”
New Blood in Production Veins
Mr. Mofateh said: “at the moment the producers do not know what will happen
in the market in the next six months, and therefore their reactions towards
international markets is very emotional. This will only add to the problems the
market already has, but with this plan, they can relax and be sure that
whatever happens in the global market, they will always have the products the
need and can always receive raw material.”
The premium discovery contracts started on November 20th, and
the consumers welcomed this plan, especially for the steel ingots of the Sirjan
Jahan Steel Complex, Chadormalu and South Kaveh steel Co, and 175000 tons of
products were exchanged in 27 contracts. 120 tons of cathode copper of the
National Copper was exchanged by 6 contracts, each selling 20 tons, and so the
premium contracts on the first day were 33.