MEED Insight estimates that by 2010, assuming all planned projects are completed on time, aluminium production capacity in the Middle East and North Africa (MENA) region will be 4.3 million tonnes a year (t/y).
This figure rises to 10.8 million t/y provided all the expansion projects at existing smelters and greenfield projects planned beyond 2010 proceed. This will mean that the MENA region will have about 19 per cent of world capacity by 2013-14.
GCC producers will continue to account for a major part of the MENA region’s aluminium production. Of the 6.5 million tonnes of potential aluminium capacity planned beyond 2010, 4.4 million tonnes will be built in the GCC. In the longer term, MEED estimates that by 2020 the GCC alone will produce some 10 million t/y of aluminium, accounting for 20 per cent of global market share.
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The region’s downstream aluminium industry is under developed. The Middle East consumes only 16 per cent of the domestically produced primary aluminium while exporting the remaining 84 per cent. The extrusion industry – manufacturing aluminium products from its primary form – accounts for almost 70 per cent of the aluminium demand in the Middle East, of which 90 per cent is allocated to the construction market.
Due to low demand for finished aluminium products, there is a limited number of rolling and casting producers in the region. More rolling and casting factories will need to be built for the aluminium industry to benefit from a sophisticated downstream market.
Although the Middle East is currently attracting investments in new aluminium plants due to its energy feedstock advantage, securing affordable long-term power and bauxite supplies are two issues that need to be addressed for the region to ensure success in the industry.
Competition for bauxite supplies is mainly expected to come from China, while securing sufficient gas to feed aluminium plants’ power stations is becoming more difficult given the direct competition for gas from the Middle East’s hydrocarbons, petrochemicals and utilities
Globally, aluminium consumption growth averaged 6.1 per cent between 2000 and 2007. However, with the world economy entering a deep recession, there is uncertainty as to the short-to-medium-term growth path for aluminium demand. Large supply curtailments have been announced by producers across the world, in an effort to revive both prices and demand for aluminium.
The slowdown in the global economy has led to a dramatic drop in aluminium prices. The determining factor in a price recovery will be how fast the consumer market can absorb the accumulated aluminium inventories once global demand returns. This is particularly important for the Middle East region, as it exports the majority of its primary aluminium production to international markets.
This information is taken from the MEED Insight report MENA Aluminium 2009: The region’s rise as a global producer. To order your report today, download the order form (PDF) or email MEED Insight for more information, quoting reference AL4.
About MEED Insight:
Thanks to its own projects tracker, MEED Projects, MEED Insight has access to unparalleled, up-to-date information on the region’s projects market. We can provide companies with:
- Details of all major projects within a given market or sector, including their scope
- Contacts for clients, contractors and suppliers
- Information on key clients and their tendering processes
- Information on how to register with clients and prequalify for projects
- Forecasting of future projects
MEED Insight has access to a wealth of regional data ranging from broad macroeconomic statistics to sector-specific information. We can obtain and analyse data on a specific market or industry to help companies gain an insight on market size and potential
MEED Insight also offers a series of off-the-shelf reports on a range of different sectors and industries. The information compiled for these reports comes from a variety of sources, including MEED magazine, MEED.com, MEED Events and MEED Projects, as well as primary and secondary research.
Our current off-the-shelf reports include:
- GCC ICT Projects Outlook & Review
- GCC Projects Forecast & Review 2010
- Power & Water in the GCC 2010
- Libya Power & Desalination
- Middle East Steel 2009
- Wastewater in the GCC
- Middle East Cement 2009
- MENA Mining 2009
- GCC District Cooling
- GCC Economic Outlook
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