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  SteelHome >>Raw Material>>Market Info>>International Dynamics
 
Indian Steel Mills Hope to Invest in Upcoming Saudi Arabian Steel, Iron Ore Projects

http://en.steelhome.cn [SteelHome] 2019-09-19 15:31:05

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Indian steel manufacturers plan to strengthen their relationship with the Middle East market, especially Saudi Arabia, according to remarks made during the second day of the First International Saudi Iron and Steel Conference on Wednesday.

"India is a natural supplier for Middle East given its position on the Indian Sea," V.R. Sharma, managing director of India's Jindal Steel and Power, said.

"The industry will definitely grow and more investments will come from India to Saudi Arabia," Sharma added, highlighting that the iron ore hubs identified in Saudi Arabia as potential opportunities. In addition, the company is hoping to seek partnerships for railway structures in the Middle East.

According to Sharma, the Indian railway industry consumes 1.7 million mt of steel annually. Steel Authority of India Ltd. contributes 1 million mt towards the total consumption, while Jindal Steel and Power contributes 700,000 mt.

Jindal Steel and Power, a unit of Jindal Group, has a total production capacity of 50 million mt of steel, out of which 2 million mt is produced at its Middle Eastern facility in Oman.

The company plans to increase its investment in the Middle East as the Indian government announced plans to increase its steel production capacity to 300 million mt by 2030. The country was ranked second largest steel producer in 2018, after China. Different panels at the conference also noted that sentiment was positive in the Indian steel market following recent elections.

Sharma also said that the casting industry is the future in Saudi Arabia and expressed interest in possible investments. "Indian companies are very keen to participate as investors in the Middle East and Africa. Our appetite is for 2 million mt to 3 million mt capacity, nothing big like China," he added.

Bhaskar Chatterjee, secretary general and executive head of Indian Steel Association, also said that the association would like to play a vital role towards achieving Saudi vision 2030.

"Where industrialization and organization goes, steel follows. We have seen that before as well," Chatterjee said. "We believe that Saudi and Indian 2030 strategies will generate synergies for both countries," he added.

Victor Vukusic, general manager of Metinvest's gulf branch, also expressed interest in the kingdom's growing steel industry. The Ukrainian company exports most of its steel products to Europe or the Middle East, Vukusic said in a presentation.

"Ukraine is a stable and predictable player in the region. It's on the right track as the country's national currency rate has not seen any substantial movement over the last three years. You cannot say that for many countries these days," he added.

The company has focused on exporting steel plates at the moment, but plans to expand its product-base for the Gulf Cooperation Council, or GCC, markets to mainly DRI pellets and hot-rolled coil. Metinvest will start production of DRI pellets in the second quarter of 2020 with 67.5% Fe content and 2.8% Silica and Aluminum oxide.

The plant will have an annual production capacity of 2.1 million mt to 2.3 million mt. In addition, the company will start production of hot-rolled coil at its Ilyich Iron & Steel Works at Mariupol by the fourth-quarter. The plant has an annual production capacity of 2.5 million mt.

India and Ukraine have home-based advantage, being rich in iron ore. If Saudi Arabia wants to grow and expand its steel industry, the government needs to utilize its home-grown advantage -- natural gas, Peter Marcus, managing partner of World Steel Dynamics said during the conference.

The conference chairman, Rayed Abdullah al-Ajaji, closed the conference by noting that the Saudi Arabian government needs to look to its natural gas assets if it wants to grow its steel industry, as recommended by World Steel Dynamics' Marcus. Ajaji, CEO of Universal Metal Coating Co. and chairman of the Saudi National Committee of Steel, also plans to work closely with Indian Steel Association's Chatterjee to look into the expansion of the steel industry in Saudi Arabia.

Source: Platts

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