A recovery in the Dubai construction market and more infrastructure projects in the GCC prompted Emirates Steel to increase production by nearly a third.
Emirates Steel shines as building increases across the GCC
A recovery in Dubai's construction market and a rise in infrastructure projects under way in the GCC has prompted Emirates Steel to lift production by nearly a third during the nine months to September, the company said yesterday.
The UAE's largest integrated steel producer said output at its plants at Icad (Industrial City of Abu Dhabi), 35 kilometres from the capital's city centre, had risen 33 per cent in the year to September 30, compared with the same period last year.
The company, which is owned by the holding company Senaat that in turn is wholly owned by the Government of Abu Dhabi, said production of steel-reinforcing bars, commonly used in building materials such as reinforced concrete, rose 10 per cent during the nine months.
The number of iron rods made by the factory increased 4 per cent for the year to the end of September and the amount of direct reduced iron, a key component in the manufacture of wrought iron, rose 20 per cent.
Emirates Steel is able to produce 2.8 million tonnes a year of steel and 3.2 million tonnes of iron.
The company said 95 per cent of its finished products were produced from its own manufactured steel, compared with 83 per cent a year earlier.
The company is selling about 70 per cent of its finished products to the domestic market, with the remaining 30 per cent exported, mostly to other GCC nations. Emirates Steel said during the first nine months of the year it had increased its domestic market share to 60 per cent and had lifted export volumes by 30 per cent compared withthe year-earlier period.
"The construction sector is the primary consumer of our rebar and wire-rod products," said Saeed Al Romaithi, the chief executive. "These figures reflect significant increases in our production and sales volumes. Although some stability is returning to the GCC's construction sector, we believe that infrastructure projects will accelerate the region's recovery over the next few years."
Established in 1998, the company has been undergoing a Dh9 billion (US$2.45bn) expansion programme since 2006 aimed at making it one of the largest and most sophisticated steel producers in the GCC. A first phase was completed in 2009 and a second partially completed last January.
"Despite the challenging conditions faced in both our domestic and regional markets, the company has delivered a strong performance in the first three quarters, delivering volumes which were underpinned by the excellent performance of our Phase 1 assets and the continuing ramp-up of our Phase 2 steel manufacturing plants," said Suhail Al Ameri, the company's chairman and also the chief executive of Senaat.
"We have commissioned [and] are delivering operational results ahead of expectations," he added.