Aluminum Glitters as an Investment in GCC, Aluminum Market to Reach $3 Billion by 2015

The GCC aluminum market is expected to reach $3 billion by 2015, led by the growth of the construction sector. Industry investments will reach USD$55 billion by 2022, thus creating a multitude of opportunities for industry and investors alike.
By: Ventures Middle East, LLC
 
May 2, 2011 - PRLog -- Abu Dhabi, United Arab Emirates

Ventures Middle East announces the release of a comprehensive report on the Aluminum Market in the Gulf Cooperative Council (GCC) region. The GCC aluminum market is projected to reach $3 billion by 2015, led by the growth of the building construction sector and rising population rates. KSA, UAE, Qatar and Kuwait are the main markets driving the overall GCC region’s growth.

Investments in the GCC aluminum industry are expected to reach USD$55 billion by 2022, driven by new factories and projects, according to Ventures Middle East’s May 2011 GCC Aluminum Industry Report.

“The GCC region, which largely focuses on upstream manufacturing activities, currently produces 7 percent of the world’s total primary aluminum supply,” Abu Dhabi-based Ventures Middle East said. “This figure will increase to 10 percent by 2017 with the completion of three new smelter facilities in Saudi Arabia.”

In 2010, there were four primary aluminum smelting facilities in the GCC (Alba in Bahrain, Dubal in UAE, Sohar Aluminum in Oman and Qatalum in Qatar). UAE-based Emal started operating in 2011, while the first of the smelter factories in Saudi Arabia (KSA) is slated to begin production in 2013.

Initial investments in KSA’s smelter facilities are estimated at USD $19.5 billion. Following the completion of these facilities, the GCC region’s total production capacity will increase at a CAGR of 18 percent to 8.2 million metric tonnes (MT) in 2017 from 2.2 million MT in 2009.

Currently, 80 percent of the GCC’s primary aluminum output is exported as billets and ingots for conversion into finished products outside the GCC. However, the region has started to shift away from primary production, similar to the trend that is occurring in China’s aluminum industry.

Meanwhile, the demand for fabricated aluminum products is rising in the local markets across the GCC region as a result of increased investments being made in the building construction projects, which is responding to meet the needs of a growing population.

In turn, this is creating a multitude of investment opportunities in the secondary production market within the aluminum industry. Industry opportunities within the GCC aluminum industry’s secondary market include casting, rolling and recycling.

The demand for primary and secondary aluminum production can also be found within the transportation sector. As the population grows, so too does the demand for automobiles. In recent years, automobile manufacturers have taken a preference to cast aluminum as its lighter weight contributes to improved fuel economy and reduced emissions. In addition, there is also increased demand for rolled aluminum applications for food and medical packaging. Currently, the GCC is a net importer of rolled aluminum products, which further supports the fact there is a local market need for aluminum rolling and the supply of rolled aluminum products.

Adding to the attractiveness of the GCC region’s aluminum industry as an investment opportunity are the local government’s longer-term initiatives that support the growth of each market’s manufacturing sector. These initiatives derive from the overarching goal of the GCC countries to decrease dependence on oil & gas sector revenues by increased investments in non-oil & gas industry sectors such as manufacturing, which includes the aluminum industry. Because these economic plans are longer-term with some country’s plans running through to 2030, increased government spending in the aluminum industry will likely continue and maintain the overall growth rates within the GCC region’s aluminum industry.

Ventures Middle East’s 169-page “GCC Aluminum Industry Report: May 2011” provides a review of global and GCC aluminum production (upstream and downstream) trends, GCC aluminum industry, market overview and five-year forecasts, recent industry activity and upstream and downstream manufacturer profiles and respective production capacities and expansion plans.

The study provides a detailed demand and import/export analysis for extruded and fabricated aluminum products within key markets such as the building construction sector for Saudi Arabia, United Arab Emirates, Kuwait, Bahrain, Oman and Qatar building construction (curtain walls, cladding, windows, doors, etc.).

Also highlighted are aluminum industry opportunities (casting, rolling) and a detailed overview of the sectors (transport, packaging) in which these opportunities can be found. The last section of the report provides an overview of the GCC’s industry regulations and the types of incentives offered by each country’s government.


To purchase the GCC Aluminum Industry Report: May 2011, contact:
VME0925 -  25% discount when you mention this code

Mrs. Tyfenn Le Guennec
Ventures Middle East
Email: tyfenn@ventures-me.com
Tel: +971 2 6222 455 ext 106
For more information, visit http://www.ventures-me.com/contents.php?contents=83

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Abu Dhabi-based Ventures Middle East is a leading market research and consulting services provider, offering a broad portfolio of consultancy services. Our services include market assessments, business planning, financial analysis, operational improvement, market insights and strategies, feasibility studies. The company also offers a proprietary industry database and syndicated research reports.
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