As power outages increase and cement factories halt production, the price of this essential construction material has experienced a rare surge. Construction industry stakeholders are calling this situation a “disaster” for the housing market.
Pezhman Jouzi, head of the Construction Industry Association, warned on Thursday, May 22, in response to the rising cement prices due to electricity and energy shortages, saying: “For the public, the news of cement becoming more expensive might just be news, but for housing producers, it is a disaster with damaging consequences.”
He criticized the ongoing power cuts to industries, adding: “The housing problem in Iran stems from internal mismanagement, not foreign sanctions. Power outages in foundational industries like cement directly harm housing production.”
Various figures have been reported for Iran’s electricity deficit. Regardless of the exact amount, evidence suggests that although summer 2025 is still a month away, the blackout crisis has become significantly worse than last year.
Jouzi pointed to the responsibility of the Ministry of Energy, saying: “This ministry must ensure a fair share of energy for industries, as energy supply is the main infrastructure for production activities.”
Production Halt, Price Surge, and Market Turmoil
In recent weeks, power outages have led to shutdowns or reduced production at cement factories in provinces such as Isfahan, Ilam, and Kordestan.
Industry associations have warned that a 90% reduction in electricity quotas effectively means factory shutdowns.
Mehrdad Ghadimi, advisor to the Karaj Construction Materials Union, said regarding the rise in cement prices: “In the past two months, the price of a bag of cement in some areas has risen from around 530,000 rials (approximately $0.064) to over 1.3 million rials (approximately $1.6).”
He added: “If factory production were just 10 to 15 percent higher, this price increase might not have been felt at all.”
According to experts and private sector activists, this crisis is not due to sanctions or resource shortages but rather stems from mismanagement and the lack of planning for sustainable energy supply.
Following these warnings and widespread blackouts across cities, Masoud Pezeshkian, the Iranian regime’s president, stated: “Cutting electricity to the production and industrial sectors is the last resort, and we will do everything we can to avoid power cuts to industries.”
Impact on Stock Market and Company Profitability
The power cuts have had an immediate negative effect on the commodity exchange and capital markets, with particularly sharp fluctuations in the shares of cement and steel companies.
These blackouts have reduced company profits and significantly increased operational costs. Although currency rate growth may partially offset these losses, power outages remain a structural risk for energy-dependent industries.
