GCC construction steel output to exceed 23 million mt by 2015

Rising infrastructural spending in the Gulf Cooperation Council (GCC) countries on the back of increased funds amid high oil prices have resulted in a year-on-year increase of 4.1 million mt in the region's construction steel production capacity in 2012, with the total capacity reaching 20.7 million mt, as stated by Ahmed Al-Ansari from Qatar Steel at the SteelOrbis Spring '12 Conference & 66th IREPAS Meeting held in London on April 1-3. Mr. Al-Ansari added that the total construction steel production capacity of the region is expected to reach 23.1 million mt by the end of 2015, including 17 million mt of rebar production capacity, 3.5 million mt of steel section production capacity and 2.6 million mt of wire rod capacity.
 
Annual rebar demand in the GCC this year is expected to total 12.6 million mt, with demand for wire rod reaching about 2.1 million mt, according to the figures presented by Mr. Al-Ansari. Rebar demand in the region is expected to reach 13.3 million mt next year, 14 million mt in 2014 and 14.7 million mt by the end of 2015. With new capacity additions and existing mill capacity expansions, rebar demand in the region is expected to be met mostly by domestic producers, minimizing the need for imports, said the Qatar Steel official.
 
In addition to the region's increasing long steel demand, Mr. Al-Ansari said that real demand for flat products is also increasing in the region, particularly in Saudi Arabia and the UAE, with most of the demand coming from the oil and gas industry. To meet this rising demand, UAE-based Emirates Steel Industries (ESI) has already announced a capacity expansion plan to produce hot rolled coil (HRC) and steel plate with an annual capacity of 3.6 million mt, which is expected to be completed in the next five years. Currently, Saudi Arabia-based SABIC is the sole flat steel producer in the region, with an annual capacity of 1.22 million mt. Al Ittefaq had earlier announced plans to build a two million mt capacity flat steel plant; however, the project has since been cancelled.