Better transport will boost Gulf steel producers

Iron and steel producers in the Gulf need an improved and expanded transportation system to boost competitiveness in the global market, delegates at the Saudi International Iron & Steel Conference 2022 in Riyadh have been told.

Amsteel chief executive Onur Yigiter acknowledged that Gulf Cooperation Council (GCC) producers enjoy comparatively low energy supply rates, making their production costs highly competitive. But the industry still had ‘a long way to go’ in terms of available transportation infrastructure, he said in a report of proceedings from event partner Kallanish Commodities.

‘We need a modern, upgraded transportation infrastructure, which will reduce transportation costs, in order to realise the potential,’ Yigiter added, noting that GCC producers were pursuing the task of increased competitiveness, having already reduced the time of discharging cargoes at ports.

But he warned they were still behind leading low-cost producers benefitting from facilities close to their primary raw material resources and ports such as in Brazil, the CIS and some Chinese mills.

‘If the plant is situated in Riyadh, it will be less competitive compared to those producers,’ he concluded. ‘We need more professional transportation companies and producers, from trucks, to infrastructure networks, and to ports.’

The Saudi 2030 Vision programme supports these competitive efforts and it is estimated it will take around ten years for GCC producers to become the lowest-cost producers globally.

The GCC, more formally known at the Cooperation Council for the Arab States of the Gulf, is a regional, intergovernmental, political, and economic union comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.