By Mohammad Shoeb
DOHA: Qatar, with an annual production capacity of 9.8 million tonnes of fertilisers, has emerged as the second-largest producer of the commodity in the GCC. Remarkably, Qatar alone produces over 25 percent of the region’s total production of 37.8 million tonne fertiliser.
The fertiliser production in the Arabian Gulf is set to expand by 14 percent to 43.1 million tonnes over the next five years, said a new report by the Gulf Petrochemicals and Chemicals Association (GPCA).
The GCC’s current fertiliser capacity earns $6.3bn (QR22.9bn) in sales revenue, according to the GPCA’s ‘2015 Fertiliser Indicators’ report. Additionally, capacity for this commodity has nearly doubled since 2005 due to strong demand from export markets, resulting in closer trade relationships with diverse markets such as India, the United States and Brazil.
“Since 2005, the GCC has been the epicentre of a dynamic fertiliser industry, whose growth has been driven by increased demand for food, growing access to feedstock and the rise in global population,” said Dr Abdulwahab Al Sadoun, Secretary General, GPCA. “With the recent focus of regional governments in developing their non- oil industries, fertilisers will continue to be a key focus sector in the medium term.”
With a production capacity of 16.7 million tonnes, Saudi Arabia continues to be the largest producer of fertiliser in the region. However, relatively flat demand from local and global markets for fertilisers, coupled with macroeconomic volatility, challenges remain for regional producers.
“There is no doubt that GCC fertiliser producers are encountering aggressive competition from producers with access to cheap feedstock as a result of the development of the shale gas in the US and coal based industries in China,” explained Dr Al Sadoun. “Being export oriented industry with over 60 percent of the output destined for international markets, regional companies must formulate and execute new strategies to ensure that their cost leadership and supply chain costs are agile. Price competitiveness will ensure retaining and expanding market share in the future.”
The Fertiliser Indicators report will be released at the GPCA Fertiliser Convention. Now in its 7th edition, the Convention will be held in Dubai from September 6 to 8. With insights on the market outlook for commodities, to upcoming trends, the conference will host regional and global experts from the fertiliser industry.
The GPCA represents the downstream hydrocarbon industry in the Arabian Gulf. Established in 2006, the association voices the common interests of more than 250 member companies from the chemical and allied industries, accounting for over 95 percent of chemical output in the Gulf region. The industry makes up the second largest manufacturing sector in the region, producing up to $108bn worth of products a year.
The Peninsula
By Mohammad Shoeb
DOHA: Qatar, with an annual production capacity of 9.8 million tonnes of fertilisers, has emerged as the second-largest producer of the commodity in the GCC. Remarkably, Qatar alone produces over 25 percent of the region’s total production of 37.8 million tonne fertiliser.
The fertiliser production in the Arabian Gulf is set to expand by 14 percent to 43.1 million tonnes over the next five years, said a new report by the Gulf Petrochemicals and Chemicals Association (GPCA).
The GCC’s current fertiliser capacity earns $6.3bn (QR22.9bn) in sales revenue, according to the GPCA’s ‘2015 Fertiliser Indicators’ report. Additionally, capacity for this commodity has nearly doubled since 2005 due to strong demand from export markets, resulting in closer trade relationships with diverse markets such as India, the United States and Brazil.
“Since 2005, the GCC has been the epicentre of a dynamic fertiliser industry, whose growth has been driven by increased demand for food, growing access to feedstock and the rise in global population,” said Dr Abdulwahab Al Sadoun, Secretary General, GPCA. “With the recent focus of regional governments in developing their non- oil industries, fertilisers will continue to be a key focus sector in the medium term.”
With a production capacity of 16.7 million tonnes, Saudi Arabia continues to be the largest producer of fertiliser in the region. However, relatively flat demand from local and global markets for fertilisers, coupled with macroeconomic volatility, challenges remain for regional producers.
“There is no doubt that GCC fertiliser producers are encountering aggressive competition from producers with access to cheap feedstock as a result of the development of the shale gas in the US and coal based industries in China,” explained Dr Al Sadoun. “Being export oriented industry with over 60 percent of the output destined for international markets, regional companies must formulate and execute new strategies to ensure that their cost leadership and supply chain costs are agile. Price competitiveness will ensure retaining and expanding market share in the future.”
The Fertiliser Indicators report will be released at the GPCA Fertiliser Convention. Now in its 7th edition, the Convention will be held in Dubai from September 6 to 8. With insights on the market outlook for commodities, to upcoming trends, the conference will host regional and global experts from the fertiliser industry.
The GPCA represents the downstream hydrocarbon industry in the Arabian Gulf. Established in 2006, the association voices the common interests of more than 250 member companies from the chemical and allied industries, accounting for over 95 percent of chemical output in the Gulf region. The industry makes up the second largest manufacturing sector in the region, producing up to $108bn worth of products a year.
The Peninsula
