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Dubai: The region's ongoing construction boom has boosted the aluminium extrusion industry and there has been a huge growth in the last few years in the number of presses making aluminum profiles.
Industry sources say new investment in extrusion presses is still being made and the challenge in the years to come will be to sustain this growth.
Extrusion is a process used to make long objects for industrial applications.
The number of extrusion presses grew by 25 to 85 in the Middle East at the end of 2007, said Modar Al Mekdad, general manager of UAE-based Gulf Extrusions.
Growth
There were just seven presses in the region in 1980. According to Al Mekdad, the construction sector accounts for 90 per cent of such aluminum products made in the Gulf.
The demand for aluminium extrusion in the Middle East is expected to reach 450,000 tonnes in 2008, with Saudi Arabia, Qatar, the UAE and Kuwait accounting for most of the increase because of high construction activity in these countries.
"There is surplus capacity in many countries while in others there is a deficit," Al Mekdad said at the MEED aluminium industry conference on Tuesday.
Last year, Saudi Arabia had a capacity of 136,000 tonnes and consumption of 135,000.
In the UAE, aluminium extrusion demand was 131,000 tonnes against a capacity of 1800,000 tonnes. Qatar's consumption was 17,000 tonnes and all of it was sourced from outside.
Al Mekdad said three to four plants are expected to be built in Qatar in three years.
New facilities are also being built in Saudi Arabia and the UAE.
Sharjah's Bukhatir Group will invest Dh100 million to build a plant in the Industrial City of Abu Dhabi.
The plant will have two extrusion presses and will be ready in a year's time, said Sadashiva Bhat, general manager of the extrusion division in group company Abtec.
It will have a capacity to 20,000 tonnes per year.
Supply
"We will be mostly supplying to the local market and also export to some markets," Bhat said.
The challenge for the industry is to sustain growth amid high aluminum and energy costs.
Costly aluminium may encourage builders to look at substitute products such as plastic.
High energy costs has made aluminum profiles $40 to $50 costlier per tonne, Al Mekdad said.
"Although there is surplus, people are continuing to set up plants. The extrusion industry is growing rapidly because of the construction boom. Efforts should be directed towards its sustainability," he said, adding that investors should think how the business will survive after the boom.
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