It is reported that a major steel maker in Oman has deferred the opening of a new plant by 6 months as the industry reels from production cuts and expansion delays caused by falling demand for steel.

The USD 750 million plant which would produce 1.5 million tonnes of steel billet per year as part of an integrated steel making operation, was supposed to open this month.

Dr BN Singh MD of Shadeed Iron and Steel said that it has delayed the commissioning of a key plant in Sohar until the middle of the year because of the slump in prices.

Dr Singh said that “Some delays we have done intentionally because the market is not very good. Everybody across the Gulf had cut production to boost prices. They cut down on their production to reduce their inventories, they have delayed their expansions.”

Dr Singh also sounded optimistic saying he was confident the market for steel in the GCC would rebound in the next year. He said that “I don’t fear anything on the market side. The stability in prices has come now. I am very hopeful that the depression may not last too long.”

Interest in GCC steel production ballooned in 2008 as steel prices rose to record levels and governments sought to diversify their economies away from crude oil exports. But prices have dropped more than 60% in recent months on falling world demand, tracking similar declines in other commodities, including metals and crude.

(Sourced from: The National)