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In the limelight – the Arabal conference 2013
The rise of the aluminium sector in the
Middle East is one of the remarkable
trends in this industry in recent years.
Although production in the region only
began in 1971, by 2020 smelters from
the Gulf are expected to contribute nine
percent of the world’s primary aluminium
production. Recognition of the increasingly
important role that the region plays
is just one of the reasons why leading representatives
from the industry will participate
in the Arabal 2013 Conference.
For the first time in its history this conference
will take place in Abu Dhabi, from 5 to 7 November,
with Emirates Aluminium (Emal),
UAE, as the host. The Middle East’s premier
trade event for the global aluminium industry
will both support the region’s position as a
leader in primary aluminium production and
showcase the advantages of doing business in
the Gulf Cooperation Council (GCC).
Arabal began in 1983 as a forum for the
region’s producers to discuss matters of mutual
interest. Over the past 30 years it has not
only helped to strengthen ties within the GCC,
but, reflecting development in the Gulf, has
grown beyond its regional origins, attracting
international prominence.
The growth of the aluminium sector in the
GCC can be traced back to the early 1970s.
In order to provide economic diversity beyond
oil and gas, governments in the region
identified aluminium as the metal of the future
and began investing in the infrastructure
needed to create a reliable source of quality
primary aluminium. The first GCC smelter
started production in Bahrain in 1971 and
was followed by the establishment of Dubai
Aluminium (Dubal) in the UAE, which began
operations in 1979. In 2007 the UAE announced
details of a second smelter for the
country and Emal was created in Abu Dhabi.
Oman’s Sohar plant started in 2008 followed
by Qatar’s Qatalum the following year. The
GCC currently has five smelters producing
primary aluminium and another smelter in
Saudi Arabia, the Ma’aden Alcoa joint venture,
near completion.
These investments were based upon the region’s
numerous strategic advantages, including
its proximity to major aluminium markets
in Europe, USA and the Far East. GCC smelters
export around 80 percent of their total
aluminium production, which highlights the
importance of the GCC’s role in the global
market.
Strategic advantages of the Gcc region
Port of the Khalifa Industrial Zone
One of the strategic advantages is access to
reliable and low-cost energy. In recent years
energy costs for many producers around the
world have increased, which makes the GCC
an all the more attractive location. However,
low energy costs are not the only reason why
smelters in the Gulf are on the upswing. As
there are recent investments in the region
for expanding or building new smelters, the
region is adopting the latest, highly efficient
technologies, which provides another business
advantage over competitors with older infrastructure.
Current primary aluminium production by
GCC smelters is four million tonnes a year,
which constitutes around 7.8 percent of total
world production. With additional facilities
set to come on stream over the next few years,
production capacity in the region is set to
rise to almost five million tonnes by 2015.
And this trend is set to continue with forecasters
estimating the GCC will be responsible
for nine percent of the world’s aluminium
production by 2020. Therefore, the region
is in ‘pole position’ to take advantage of
the forecasted six percent year-on-year rise in
global demand for aluminium over the next
decade.
However, GGC smelters are not only
aligned to overseas sales. A major factor in
the drive for economic diversification is developing
the local downstream industry. The
Gulf has access to huge regional and international
markets: situated between Asia and
Europe, advanced transportation links provide
ready access to around two billion consumers
across four time zones.
Projects, such as Abu Dhabi’s Kizad (Khalifa
Industrial Zone), support the diversification
of the local industrial base by establishing
hubs for manufacturing, logistics and trade
for both local and international companies to
take advantage of. Value is added at every
stage of the supply chain through efficiencies
of scale, proximity and market access.
Kizad is one of the world’s largest industrial
zones and has made aluminium a focus
for development. Emal is one of the zone’s anchor
clients and the proximity of Khalifa Port
allows easy and quick movement of goods and
raw materials. Kizad has also built the socalled
Hot Metal Road allowing delivery of
products directly from Emal to local companies.
The downstream targets for Kizad are
rolling and extrusion products as well as castings
and forgings for industries such as construction,
transport, packaging and engineering.
The latest project is the Senaat / Ducab
joint venture for aluminium rod. (For further
details see News in brief section in this issue).
By adding to the international profile of
GCC countries, providing sustainable income,
creating jobs and expanding the local economic
base, aluminium is proving to be a
major return on investment. This growing importance
will be reflected at the Arabal 2013
Conference. Already recognised as a strong
networking platform for the industry, it will
attract global aluminium leaders with an
agenda which will not only focus on developments
in the region, but also provide insights
and perspectives from around the world. ■
© Kizad
24 ALUMINIUM · 11/2013