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UAE focuses on value added products; export of aluminium alloy is on the rise
Gulf region is the fasted growing aluminium producer and exporter in Asia after China. The volume of aluminium production in the GCC countries stood at 5.2 million tonnes in 2015, accounting for around 10 per cent of total global output of 58 million tonnes. This was due to the major expansion of existing smelters and commissioning of new projects that the production is increasing at a faster rate. After oil and natural gas, now aluminium is one of the key economic drivers for the Gulf region. About sixty per cent of the total aluminium production in the GCC region is exported to different parts of the world.
Emirates Global Aluminium (EGA) in UAE is the top aluminium producer in GCC and it is also among the five largest aluminium producers in the world. EGA’s consists of Dubai Aluminium (“DUBAL”) and Emirates Aluminium (“EMAL”) – whose combined production is 2.4 million tpy. United Arab Emirates also is the global leader in export of aluminium alloys. The country has doubled its export capabilities in the last 5 years. Emirates Global Aluminium (EGA) is the major producer and exporter of aluminium alloys in UAE.
Most of EGA's annual production is value-added products, with about 90 per cent of total production being exported across the world. Alloy billets make up 46 per cent of EGA’s total aluminium production. The two operations of EGA at Jebel Ali and Al Taweelah manufacture high purity aluminium in the form of ingots for high-precision use in the electronics and aerospace industries. They also produce a range of alloys for automotive manufacturers who use them for making strong and lightweight wheel rims, suspension parts and engine blocks.
In 2015, UAE produced 2.6 million tons of aluminium. Out of the total production, 2.2 million tons were exported globally. The total value of aluminium export was USD 4.7 billion. In 2016, exports of aluminium are estimated to drop to 2 million tons and the export value stood at USD 5 billion. Based on the two years trend, for the first eleven months of 2017, UAE is forecasted to export about 1.8 million tons of aluminium and the revenue realization is estimated to be about USD 4.8 billion.
Out of the total aluminium production, UAE exported 1.5 million tons of aluminium alloys in 2015. The value of export was USD 3.5 billion for the same amount. In the year 2016, UAE is estimated to export 1.6 million tons of aluminium alloys and the value of export is estimated to stand at USD 3.8 billion. Based on the two years trend, for the first eleven months of 2017, UAE is forecasted to export about 1.5 million tons of aluminium alloys and the revenue realization is estimated to be about USD 3.7 billion.
The top aluminium importers from UAE are USA, Germany and Japan. The three countries together form about 39% of aluminium alloy export. India, Malaysia, France and Japan also import substantial amount of aluminium alloys from UAE.
The drop in total aluminium export is driven by growing domestic downstream applications in the current year. EGA is now set to start delivering molten aluminium to the downstream producers in Khalifa Industrial Zone Abu Dhabi (Kizad) via a dedicated hot metal channel from its Al Taweelah smelter. This is a part of EGA’s project that was initiated as a means of cutting cost and in order to develop a competitive aluminium value added segment in UAE.
EGA earns substantial revenue from the export of aluminium alloys and the amount of alloy export is increasing YOY. This shows EGA’s focus on exporting value added products rather than exporting primary metal. This adds significantly to the revenue realization from aluminium export.Get fresh Aluminium data and insights
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