Riyadh: The World Steel Association has reported that Saudi Arabia's production of iron is expected to increase to 9.3 million tonnes this year compared to 7.6 million tonnes in 2009 and will reach 10 million tonnes next year.
According to a report issued Wednesday by the association, Saudi Arabia produced 1.3 million tonnes of iron and steel in the first quarter of this year, compared to 938,000 tonnes in the same quarter of 2009, an increase of 70.4 per cent.
In its report, the World Steel Association, which consists of 66 member countries including Saudi Arabia, said that the Saudi production of iron reached 419,000 tonnes in March and 428,000 tonnes in February.
The association expects the kingdom's production to increase from 7.6 million tonnes in 2009 to 9.3 million tonnes this year and to reach 10 million tonnes in 2011, an increase of 22.2 per cent between 2009 and 2010, and 7.9 per cent between 2010 and 2011.
As for other Arab countries it was reported that Egypt's production of iron and steel in March reached 497,000 tonnes. In Qatar it was 170,000 tonnes followed by Morocco, Libya and Algeria, the four biggest iron producing countries in the Arab world.
Global production
According to the report, the global production of iron and steel in March increased by 30.6 per cent over the same month of 2009. It said that the volume of production was continuously increasing compared to the beginning of this year.
The 66 member states of the association produced in March a total of 120 million tonnes, compared to 92 million tonnes in the same month in 2009, at the height of the global economic crisis.
There was remarkable growth output of iron in March compared to (108 million tonnes) in February and 113 million tonnes in January.
The production of China, which came at the top of the 66 countries increased in March by 22.5 per cent over March 2009, with production of 55 million tonnes. US production was 6.9 million tonnes.
Russia produced 5.5 million and Germany 4 million. Italy's production was 2.4 million and Turkey's was 2,1 million while France produced 1.48 million tonnes.
Crude
New major consumers
Ebrahim Al Muhanna, an adviser to Saudi Arabia's Petroleum ministry, said India, Russia and Brazil will become "major" oil consumers over this decade and the share of Saudi crude shipped to Europe will decrease.
"Within 10 years, if the trend of current economic growth continues, there are likely to be three additional major consumption centres: India, Russia and Brazil," Al Muhanna said yesterday in a speech in Paris. "International oil demand will become more highly diversified."
Oil futures have rebounded 70 per cent over the past year on confidence that the economic recovery will boost demand. On April 13, the International Energy Agency raised its 2010 global oil consumption forecast by 30,000 barrels a day to 86.6 million a day, citing demand in North America and the Asia-Pacific region. The next day, the Organisation of Petroleum Exporting Countries said Brazil and Russia will continue to drive growth.
Increasing volumes of Saudi oil are being sent to Asia and less are going to Europe and the US as demand patterns change, Al Muhanna said yesterday. "The shift of market share of Saudi oil to Asia is purely a business and market issue," he said. "I hope that anyone tempting to project political motivations into this trend will recognise that what is taking place is merely a logical adjustment to market realities."
Unconventional oil projects, which include tar sands, shale oil and fuel from biomass, will increasingly determine minimum crude prices, Al Muhanna said.
— Bloomberg
