Middle East Growth Potential in Production of Steel Flat Products

1. Finished capacities growth average 13% p.a. in 2002 – 2004 (from 35 m MT to 44 m MT)
2. However, there is imbalance between longs and flats capacities (80/20) vs. the global split (60/40).
3. And the level of integration is low (49%) .. but increasing.
4. Capacity utilization came under pressure from rising costs and scarce raw materials, dropping from 56% in 2002 to 52% in 2004.
5. The industry is highly fragmented (62 producers):
Only 3 producers have 2+ million tpy capacity each.
Only 8 producers have 1+ million tpy capacity each.
51 Producers have less than 1 m mt capacity each
6. Exports from the region increased 20% p.a. to 4.3 m tpy (2002 – 2004).
7. Imports into the region increased 6% p.a. to 9 m tpy (2002 – 2004).
8. At 64kg, per capita consumption of crude steel in the region also remains very low, compared to :
CIS (123 kg)
Asia (138 kg)
EU (399 kg)
Global average (162 kg)