Italy’s service center and trader company Eusider says it has signed a long-term agency agreement with the biggest ferrosilicon producer in Iran.
The exclusive distribution agreement with Iran Ferroalloys Industries Company would give Eusider “the right space to market” Iranian ferroalloys, the company said.
Through the agreement, “we will add value to our clients as we will be able to offer on regular basis different quality grade materials," Platts quoted the company as saying.
Iran Ferroalloys Industries Company, based in Azna in Lorestan province, is the first and the biggest Iranian ferrosilicon producer founded in 1987. Ferrosilicon’s main application is in steel production.
According to its website, the company has three furnaces with an annual capacity to produce 60,000 million tonnes of 75% ferrosilicon.
Eusider’s announcement came just after Italy said it would sign a deal worth 1.2 billion euros next week to build a high-speed railway between the Iranian cities of Arak and Qom.
Renato Mazzoncini, CEO of Italy's state railway company Ferrovie dello Stato (FS), will visit Tehran on July 11 to finalize the construction of the 135-kilometer line.
Italy has traditionally had close economic ties with Iran and the two countries have signed initial deals worth up to 17 billion euros in the wake of a nuclear deal which saw sanctions lifted on the Islamic Republic in January 2016.
Italian steel firm Danieli has signed commercial agreements worth up to $5.7 billion with Iran, including a joint venture, called Persian Metallics, worth $2 billion.
Steel is a strategic commodity for Iran, which is also the Middle East’s biggest carmaker. It is fundamental to the Iranian society with its massive oil and gas industry, transportation network, water supply, urban centers and mammoth construction.
Steel was Iran's largest export item after oil, gas and petrochemicals last year, partly because of the slump in domestic construction.
The country has been boosting steel production, targeting an output plateau of 55 million tonnes per year by 2015.
Currently, the nation produces 16 million tonnes, which is one percent of the world total. A statement on the Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO)’s website says exports are expected to hit 20-25 million tonnes by 2025.
Iran’s biggest mill is Mobarakeh Steel Company which produces 7.2 million tonnes of steel per year.