Speaking at the 11th Petrochemical Industry Excellence Awards, Afshar
Baziar underscored the sector’s critical role in Iran’s economy, highlighting
the need for transformation in response to global trends and internal
challenges.
"The petrochemical industry significantly contributes to foreign
exchange earnings, technology, and employment; however, it faces challenges
such as 19% idle production capacity, feedstock constraints, high energy
consumption, excessive carbon emissions, and non-competitive pricing,"
Baziar said.
Addressing Structural Inefficiencies
Baziar emphasized that Iran’s petrochemical industry, despite having a
nominal production capacity exceeding 90 million tonnes annually, is only
utilizing around 70 million tonnes. "The 19% idle capacity, driven by
feedstock shortages and infrastructure deficiencies, poses a serious obstacle
to industry growth," he noted.
High energy consumption remains a pressing issue, with certain
production units using up to 30% more energy than the global average.
Additionally, Iran’s petrochemical sector contributes over 20 million tonnes of
carbon dioxide emissions annually, accounting for 25% of the country’s total
CO2 output.
"The industry must adopt sustainable practices to enhance
efficiency and reduce its environmental footprint," Baziar stated.
Diversification and Value Chain Development
Iran’s petrochemical industry has long relied on products such as
methanol, urea, and polyethylene, which offer relatively low value-added
benefits. "A shift towards advanced polymers, nanocomposites, and
high-value materials is essential for improving global competitiveness,"
Baziar said, pointing out that leading international firms are already
prioritizing such products.
He also warned against over-reliance on a single market, noting that
over half of Iran’s petrochemical exports are destined for China. "This
concentration poses trade risks; we must expand into new markets and enhance
export strategies," he said.
Moreover, Iran remains heavily dependent on imported catalysts, with
70-80% of its needs being sourced externally, costing the country around $500
million annually.
Strategic Solutions for Industry Growth
Baziar outlined several strategies to enhance efficiency and
sustainability in the sector. "Energy management, domestic technology
development, process optimization, and circular economy initiatives are
critical to improving industry performance," he said. As an example, he
cited a petrochemical plant that reduced energy consumption by 7% through olefin
unit optimization, potentially saving billions of cubic meters of gas and
generating billions of dollars in additional revenue.
Developing petro-refineries to ensure a stable and diverse feedstock
supply was another priority highlighted by Baziar. "These integrated
facilities can strengthen the petrochemical value chain and reduce dependence
on limited resources," he added.
Digital Transformation for Competitiveness
Baziar also stressed the importance of digitalization and integrated
management systems. "Leading global firms are leveraging smart
technologies to optimize production and maintenance processes. Investing in
these advancements can significantly boost Iran’s petrochemical
competitiveness," he asserted.
To strengthen exports and profitability, Baziar recommended innovative
market strategies such as joint production agreements for niche products,
long-term sales contracts for less-demanded goods, and entering new markets
through retail distribution networks.
Despite the challenges, Baziar expressed optimism about the industry’s
future, citing Iran’s vast energy resources, skilled workforce, and strong
petrochemical infrastructure. "With committed leadership and the right
support, Iran’s petrochemical industry can sustain its pivotal role in the
national economy while expanding its global influence," he concluded.