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                          Emirates Steel inks iron ore supply agreement with LKAB

                          ifpinfo

                          April 1, 2013
                          in Event News
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                          Emirates Steel is owned by the General Holding Company (GHC). Established in 1998, Emirates Steel is currently implementing a comprehensive business development plan. Once complete, the Company will be one of the largest and most competitive steel producers in the Gulf Cooperation Council (GCC) region. The Company is evolving from its roots of being a simple and relatively low value-added processor of steel into a sophisticated, highly productive manufacturing business with a high added value business model.
                          Emirates Steel is the Gold Sponsor of Project Qatar 2013, the 10th Anniversary of the event.

                          Emirates Steel Industries PJSC (“Emirates Steel” or the “Company”) announced that it has signed a sales contract with Sweden’s LKAB to source quality iron ore pellets beginning 2013.

                          Highlighting the importance of the agreement, HE Hussein J Al Nowais, Chairman of Senaat, the Holding company of Emirates Steel, said it aims to complement the company’s efforts to enhance the value of its steel products by sourcing high quality raw materials with international standards. He recognized the expertise and high regard in the market for LKAB.

                          Al Nowais, who is also the Chairman of Emirates Steel, confirmed that the Company will continue to elevate its investment plans to accommodate the increasing demand for steel in local and regional markets. He was confident that Emirates Steel will further grow its competitive advantages by increasing its focus on quality and raising the standards of products to higher levels as LKAB becomes one of the partners contributing to the Company’s development plans.

                          The Senaat Chairman, along with other board members and senior management officials from both parties, witnessed the contract signing by Emirates Steel CEO Engineer Saeed Ghumran Al Romaithi and LKAB CEO Lars-Eric Aaro.

                          Commenting on the agreement with one of the world leading producer of processed iron ore products for steelmaking, Mr. Al Romaithi said that “the long-term strategic relationship positions the Swedish firm as one of Emirates Steel’s primary suppliers of iron ore pellets”. Emirates Steel, the largest integrated steelmaker in the UAE, has pellets requirements this year of around 4.8 million tons. These are supplied through long-term agreements which now include LKAB.

                          According to Mr. Al Romaithi, “the new agreement will strengthen our supply in support of our future growth plans”. In 2012, Emirates Steel began for the first time producing at a capacity of 3.5 million (metric tons) Mt, following two expansions and the investment of AED 10 billion (US$ 2.72 billion). Other planned projects in the future are expected to increase the company’s output of finished products to more than 5.5 million Mt.

                          Mr. Al Romaithi said: “The new supply highlights our confidence about the long-term prospects for the steel industry in the MENA region. The long-term contract helps us secure the supply of our primary feed material”. Pellets are a primary raw material for Emirates Steel to produce high quality direct reduced iron (DRI).

                          Mr. Aaro said: "The agreement is a confirmation that our products are attractive in the market. Emirates Steel plays a significant role in the UAE’s steel making industry and we are absolutely delighted to be able to support Emirates Steel’s future development by guaranteeing a stable and predictable supply of iron ore”.

                          LKAB is an international high-tech minerals group that produces iron ore products for the steel industry and mineral products for other industries and applications. The LKAB Group has about 4000 employees in 14 countries and accounts for 10% of Sweden’s industrial investments.  LKAB’s high-quality, climate-friendly iron ore products – mainly pellets – streamline customer processes while reducing global emissions of greenhouse gas.
                          ifpinfo
                          1 April

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