This message was given at the conclusion of TeknoTube Arabia
2011, the 10th International Trade Fair for Industrial Machinery, Metalworking,
Machine Tools, Dies/Molds, Tubes, and Pipes here.
The show urged the Gulf’s tubes, pipes and steel industries
to enhance cooperation in logistic operations, human resources development and
boost the competitive abilities of their products in the international markets.
It will help increase cooperation between GCC nations and help them avoid
harmful competition, especially during times of crisis and low demand.
The Middle East steel market today stands at a crossroads.
For the first time in the region’s industrial history, steel production is
coming close to meeting domestic demand. With the ramping up of production
capacities in the UAE, Saudi Arabia, Egypt and Oman, steel users and
fabricators now don’t have to rely much on imports from other regions.
With regard to seamless piping that is used heavily by the
oil and gas sectors, JESCO in Saudi Arabia plans to produce 200,000 tons in
2011, with a total rolling and finishing capacity of 400,000 tons. Another
major regional player, Al Jazeera Steel Products of Oman, has recently upped
production capacity to 300,000 tons per year. With OCTG pipe consumption in the
Middle East projected to be 1.2 million tons in 2011, these companies will play
a significant role.
Other players like Zamil Industries and Al Mansoori from
Saudi Arabia have 170,000 tons of finishing capacity. ArcelorMittal’s new seamless
mill project in Saudi Arabia, with a capacity of 600,000 tons, is projected to
start sometime in late 2012. However, imports from China, India and Europe will
still account for more than 30 percent of tube and pipe consumption in the GCC
region in 2011.
Jun Yao, general manager of BAOSTEEL, a first time exhibitor
in TeknoTube Arabia 2011, said: “The Middle East constitutes five percent of
our total business. We do $100 million sales annually. In five years, the steel
industry in the UAE will grow 10 percent in the GCC and North Africa region. As
the largest steel provider in China and the third largest in the world, we are
upbeat on this region. Steel prices, which were at their peak in 2007, have
dropped by 10 percent.”
“There is a huge market for the Chinese companies in the
Middle East and we are looking for agents from the region. Tubes and pipes
manufactures from China are coming here to test the market,” Yao added.
Chinese participation in TeknoTube Arabia 2011 rose by 40
percent. Chinese tube and pipe industry competes with global industry by its
sheer volume of production. Chinese companies can produce volumes faster than
any other suppliers in the world.
Satish Khanna, general manager, Al Fajer Information and
Services, said: “The Gulf has the largest concentration of energy resources in
the world, with oil producing countries in the region estimated to have spent
approximately AED182.5 billion ($50 billion) to increase their current oil
production or on new explorations by the year-end.”
Khanna added: “The global demand for energy, infrastructure
development, construction projects, water and air conditioning supply and
automobiles — the key sectors that drive the tube and pipe industry — will
continue to grow in the coming years.”
Steel was a big highlight of the show. Khanna added: “GCC
steel imports are in the region of $8 billion, growing at 20 percent CAGR.
Steel represents a large portion of the GCC’s base metals industry, and there
will be a production shortfall of 14 million tons by 2015. The value of the
projects planned and under way in Iraq soared by 12.3 percent to reach $182.6
billion.”
As far as the tube industry is concerned, the Middle East
has witnessed the launch of a series of new tubes plants one of which is the
Empower Logstor Insulated Pipes Systems (ELIPS), the UAE’s largest
pre-insulated pipe manufacturing facility, in Jebel Ali.
“As for the tube industry, the GCC and Middle East are
proving to be increasingly attractive markets for international tube
manufacturers. Some of the growth sectors include oil and gas technology,
petrochemicals, water and electricity supply, drainage as well as construction.
Huge investments by the government as well as private sector have been made in
this sector and more are in the pipeline,” added Khanna.
Khanna added: “The present demand from Gulf countries for
pipes and tubes is met through imports; however leading manufacturers of steel
pipes and tubes in the Gulf region are looking at reducing the imports as much
as possible through the production of millions of tons of tubes and pipes every
year.”
Tekno Tube Arabia 2011, which attracted a cross-section of
the world’s tube and pipe customers, is the oldest show in the region and is
regarded as the ideal gateway to the extremely important Gulf and Middle East
markets. The event, which was running concurrently with ArabPlast, together
attracted 18,680 visitors.
