EghtesadOnline: Iran has achieved self-sufficiency in the production of Emulsion Polyvinyl Chloride (EPVC), the raw material used in the production of footwear, bags and leather, says managing director of Arvand Petrochemical Company, Hassan Neshanzadeh Moqaddam.
Speaking to ILNA, the official said Iran produced 10,000-11,000 tons of EPVC in the fiscal 2017-18, which doubled in the following year (March 2018-19).
According to the official, EPVC production is expected to reach 28,000 tons by the end of the current fiscal year (March 19, 2020), while demand stands at 24,000 tons per year.
"Once this year’s production target is fully realized, the country will not only be able to meet domestic demand, but will have a 4,000-ton surplus that can be exported," Financial Tribune quoted him as saying.
“Domestic footwear and leather producers have had to import the chemical compound from South Korea, China, or Saudi Arabia but now they have access to high-quality EPVC at more affordable prices.”
He noted that 50% of the EPVC offered in energy bourse will be allocated for footwear and bag producers at the request of related unions.
Moqaddam said producers previously had to pay $40 per ton for the transportation of South Korean EPVC plus 10-15% customs duty, but now costs related to transportation and custom duties have been eliminated.
With a production capacity of 2.8 million tons per year, Arvand Petrochemical Company produces sodium hydroxide (660,000 tons per year), suspension polyvinyl chloride (300,000 tons per year) and EPVC (40,000 tons per year).
The increased domestic supply of EPVC is particularly expected to give a boost to footwear producers.
Iran is the 12th biggest producer of footwear in the world, producing 177 million pairs annually.
“The country has a share of 0.8% in global footwear production,” says the chairman of the Association of Managers and Experts of Iranian Shoe Industry.
Ali Lashgari was speaking during the ninth meeting of Industry and Mine Commission of the Tehran Chamber of Commerce, Industries, Mines and Agriculture last week.
The official noted that China is the biggest producer of footwear in the world with an annual production of 13.52 billion pairs and a 57% global share and has a 34.9% share in the global export of footwear.
He noted that 12.8 billion pairs of footwear were produced in the world in 2018.
Worldwide, imports stood at 11 billion pairs. China, Vietnam, Germany, Belgium and Turkey are the top five exporters of footwear in the world. The US, Germany, the UK, Japan and France are the biggest importers, TCCIM reported on its website.
The highest average footwear export price belongs to Italy with $48.15 and the lowest to Kenya with $0.86.
According to Lashgari, the average footwear export price for Iran stands at $6.06.
Iran’s annual footwear consumption is 227 million pairs, registering a 1.1% share in global footwear consumption. Imports have a 22.4% share in the Iranian market.
The country’s footwear exports decreased from $121 million in the fiscal 2013-14 to $115 million last year (March 2018-19).
Official statistics show Iran imported an annual average of $13.5 million worth of footwear in the past six years (fiscal 2013-14 to 2018-19). “However, the actual figure, including illegal imports, indicates an average of $308.6 million during the same six-year period,” Lashgari said.
According to the official, Iran is the world’s 93rd exporter and 64th importer of footwear.
Some 500,000 direct and indirect jobs have been created in the production and distribution chain of natural and synthetic leather, bag, footwear, and related industries.
Estimates show 60-65% of units operating in Iran’s footwear industry are medium- and large-sized, while 30-35% are small-sized units.
Tehran, East Azarbaijan, Khorasan Razavi, Isfahan, Qom, Zanjan, Alborz, and Qazvin are the leading footwear-production provinces in the country.
According to Lashgari, the main priorities of Iran's footwear industry include forging joint foreign investments, maintaining and developing the domestic market, creating brands, establishing advanced distribution networks, boosting industrial clusters and exports, marketing and advertizing to encourage Iranians to use domestic products, improving productivity and reducing production costs.
The Sixth International Exhibition of Bags, Shoes, Leather and Related Industries, also known as MPEX 2019, is scheduled to be held at Tehran’s International Fairground from Oct. 21-24.
The four-day event will host 183 domestic as well as foreign firms from China, Turkey, Germany and Italy, the event’s website at Mpex.ir reported.
Speaking at the expo’s press conference, Rasoul Shajari, the head of Tehran’s Handmade Shoemakers and Sellers Union, said Iraq, Afghanistan, Azerbaijan and Russia are the main destinations of Iranian footwear.