Exporters

Emirates Steel will produce more value-added products to protect its bottom line

Emirates Steel will produce more value-added products to protect its bottom line



Emirates Steel eyes Indian market

The company is fast advancing as a reliable supplier of steel with its new focus on value-added products set to attract quality-driven local and overseas markets

November 2014

Emirates Steel, currently servicing a large order from India’s Reliance, plans to develop business alliances with leading Indian firms in view of the country’s burgeoning construction sector.

“We are looking at establishing strategic alliances with leading companies in India and we believe we have the state-of-the-art facilities and products and services and a highly-experienced and committed workforce to allow us to grab a significant market share in India’s booming steel market,” said Ahmed S Al Dhaheri, chief commercial officer of the Abu Dhabi-based steel firm said.

The deliveries that Emirates Steel is making for Reliance are for its J3 refineries project in Jamnagar, Gujarat, western India. Reliance, one of largest independent industrial conglomerates in India with a turnover in excess of $68 billion, is expanding its refining and petrochemical facilities.

India recently launched its 100 smart cities project, which will accommodate around 100 million citizens once complete. “The Indian market is a strategic market for us and we will focus on strengthening our presence and supporting their growth plans,” pointed out Al Dhaheri in comments on the participation of Emirates Steel at The Big 5 Construct India event in Mumbai. “And with the accreditation of BIS to our products, supplies to India are poised to increase. Hence, we expect to complement locally produced section products with our niche jumbo beams,” he stressed.

In 2013, production of long products at Emirates Steel reached 2.6 million tonnes, an increase of 12 per cent over 2012. Of that, 1.7 million tonnes were rebar, 316,000 tonnes structural steel and 573,000 tonnes wire rod. Encouraged by a buoyant project market in the region, the steelmaker sold 3.0 million tonnes of product in 2013, of which 1.9 million tonnes were sold in the domestic UAE market. The balance was exported to a diverse range of markets including Europe, the Far East, the Americas and the Middle East.

 

FOCUS ON VAPS

The Emirates Steel pavilion at The Big 5 Construct India show in Mumbai

The Emirates Steel pavilion at The Big 5 Construct India show in Mumbai

Emirates Steel plans to expand its presence on the global stage with the introduction of more value-added steels to its product basket. Some of the demand for value-added steels could come from the Middle East itself where mega construction projects are in the pipeline.

“We have been closely observing the benefits large steel producers in the world are reaping by progressively moving into value-added products (VAPs) and we are hopeful that by adopting this model we will continue to protect our bottom line amid the current challenging industry circumstances,” said Emirates Steel’s CEO Saeed G Al Romaithi earlier this year.

VAPs are mainly finished steel and are termed so depending on their treatment or their end use. The products vary from sheet piles to high silica wire rod to long steel bars to alloy steel. The primary focus is to make stronger steels with higher tensile strengths and steels with special mechanical properties so that lesser quantity of steel is required by customers for similar applications.

Al Romaithi says consumers are shifting to premium steel as it guarantees optimum returns on their investment. For Emirates Steel this trend will eventually result in generating higher profit margins. Not many steel makers in the Middle East region are present in the value-added segment, one reason why the Abu Dhabi steel maker is expanding its product manufacturing lines.

Emirates Steel is the only integrated steel manufacturer in the UAE

Emirates Steel is the only integrated steel manufacturer in the UAE

The company has stressed that growing the share of value-added and sophisticated steel products in its export basket will make it more competitive within the region and in wider international markets.

The company also makes steel for building offshore oil rigs. It produces grades with higher mechanical properties to meet market demand in the oil and gas sector. The new structural steel it has developed, the S355J2, is intended for the supply of offshore oil and gas structures.

Among other high-value steel products it makes are those for nuclear energy plants. The ASME-certified steel maker has made deliveries for the UAE nuclear project site in Barakah.

 

SHEET PILES

Last April the company announced it had expanded its product range to include sheet pile materials which it had been developing over the past two years. It is the only Middle East steel manufacturer to develop and sell such materials

The company’ sheet piles possess significant and highly cost-effective structural and pile driving properties. Its first sheet pile brand was the z-shaped ESZ18” and the first sheet piles were exported to Europe. The mill’s product development team will work on building up the portfolio with the addition of five more Z-products in the two coming years before the range is complete by 2017. According to Emirates Steel estimates, the demand for sheet piles in the GCC is around 80,000 tonnes per year.

Emirates Steel said it plans to produce up to 150,000 tonnes of sheet piles a year, depending on market demand.




More Stories



Tags