Iran's Cement Production Capacity and Its Role in Exports
Iran is currently one of the top 10 largest cement producers in the world. The country’s nominal cement production capacity is estimated at about 88 million tons per year, while actual production in recent years—due to energy constraints, lower domestic demand, and certain infrastructure issues—has reached between 65 and 70 million tons per year.
On average, 15 to 20 million tons of cement and clinker are exported annually to foreign markets. This has positioned Iran as one of the top three cement exporters in the Middle East.
Iran’s export markets are mainly neighboring countries with a high demand for cement. According to official reports from Iran's Customs in 1402 (2023/24):
- Iraq, importing over 7 million tons of cement and clinker, was the largest export destination for Iran.
- Afghanistan, purchasing nearly 2 million tons, ranked second.
- Central Asian republics such as Turkmenistan, Tajikistan, and Uzbekistan imported over 1.5 million tons from Iran in total.
These figures demonstrate that cement exports are not only a key element of Iran's foreign trade but also play a vital role in balancing domestic supply and demand, as well as generating foreign currency.
Iraq: The Largest Destination for Iranian Cement Exports
Due to unique economic conditions and extensive post-war reconstruction, Iraq has long been one of the main cement consumers in the region. With limited domestic production capacity, the country meets most of its needs through imports.
Because of a long land border and low transportation costs, Iran holds a special position in supplying cement to Iraq. According to 1402 (2023/24) official statistics, over 7 million tons of Iranian cement and clinker were exported to Iraq. This amount represents nearly 40 percent of all Iranian cement exports.
Key Factors for Iran’s Success in the Iraqi Market
- Geographical proximity and the possibility of land transport by truck or rail.
- Competitive pricing compared to Turkey and Arab countries.
- Acceptable quality—Iranian cement meets Iraqi standards.
- Stable contracts between Iranian companies and Iraqi traders.
Challenges of Cement Exports to Iraq
- Competition with Turkish producers who benefit from proximity to northern Iraq.
- Changes in tariff rates and periodic restrictions by the Iraqi government to support domestic production.
- Security and political issues that can sometimes hinder transportation.
Despite these challenges, Iraq remains Iran’s most important cement export market, and with ongoing construction and reconstruction projects, this cooperation is expected to continue in the coming years.
Afghanistan: The Second Key Market for Iranian Cement Exports
Afghanistan, due to insufficient cement production and the high demand for construction materials in infrastructure, housing, and post-conflict reconstruction projects, is a key market for Iranian cement exports. The factors, opportunities, and challenges influencing Iranian cement exports to Afghanistan include:
Statistics and Import Levels of Iranian Cement into Afghanistan
- According to trade reports in recent years, nearly 2 million tons of cement and clinker have been exported from Iran to Afghanistan.
- This amount constitutes about 10–12% of Iran’s total cement exports.
Opportunities
- Urgent reconstruction needs: With extensive road, electricity, and building projects underway, Afghanistan’s demand for construction materials remains high.
- Geographical proximity: Iran's legal border crossings with Afghanistan make land transport cost-effective.
- Low Iranian production costs: Access to mines, affordable labor, and shorter shipping times compared to imports from distant countries make Iranian cement economically attractive for Afghanistan.
Challenges
- Poor transport infrastructure: Some land routes at the border are low quality, increasing transport costs and times.
- Political and security stability: Security fluctuations and changes to border regulations can disrupt exports.
- Competition from other nations’ cement: Countries such as Turkey and Pakistan are also actively supplying the Afghan market, sometimes offering more competitive prices or transport terms.
- Need for quality control: Afghan buyers value durable, high-quality cement that meets Iranian or international standards. The presence of counterfeit or low-grade cement can damage the credibility of Iranian exports.
Central Asia: A Strategic Destination for Iranian Cement Exports
Central Asia includes Uzbekistan, Turkmenistan, Tajikistan, Kazakhstan, and Kyrgyzstan. Due to growth in construction, infrastructure projects, and in some countries limited domestic production, the region is an important market for Iranian cement exports.
Statistics on Iranian Cement Exports to Central Asia
- According to official statistics, Iran annually exports about 1 to 1.5 million tons of cement and clinker to Central Asian countries.
- Turkmenistan and Tajikistan import the most, since their domestic production capacity is limited.
- The share of Iranian cement exports to Central Asia is estimated at around 5 to 7 percent of total national exports.
Opportunities
- Geographical position: Through its northeastern borders and the Caspian Sea, Iran has good access to this region.
- Growth in urbanization and construction projects: Infrastructure development, road building, power plants, and high-rises in Central Asia have pushed up cement demand.
- Price and quality advantages: Compared to competitors such as China and Turkey, Iranian cement is more competitively priced.
Challenges
- Transportation issues: Limitations in rail lines and high transit costs mean shipping cement to Central Asia is expensive.
- Regional competition: Turkey, Kazakhstan, and China are active in the market, and with local production investments, regional countries’ reliance on imports is decreasing.
- Trade regulations: Some countries impose high import tariffs to protect domestic production.
Conclusion
Iran's cement exports to Iraq, Afghanistan, and Central Asia demonstrate that these three regions are not only key target markets, but also play a vital role in the stability of Iran's cement industry. With Iraq’s large import volume, Afghanistan’s urgent reconstruction needs, and Central Asia’s long-term development opportunities, these are the three pillars of Iran’s cement trade.
However, to maintain and expand its market share, Iran must focus on several key areas:
- Investment in transport infrastructure—especially railways and export terminals.
- Improving cement quality and packaging to compete with foreign brands.
- Signing stable and governmental contracts with destination countries to ensure long-term markets.
- Diversifying markets and entering new countries alongside traditional ones.
If these steps are properly taken, Iranian cement can continue to be one of the country’s leading non-oil export products.
