Sabic plans to raise its steel output by 22.6 per cent to 6.5 million tonnes by 2010.

“By 2010 we will be done with our last expansion plan, which will add another one million tonnes of steel,” Hisham Al Hmili, general manager for steel products sales and marketing at Sabic’s metal group, said.
Hadeed, the largest GCC steel producer, would have capacity of 5.5 million tonnes by the end of the year, up from 5.3 million tonnes now, Al Hmili said. The increased capacity at steel subsidiary would be used to supply the domestic construction market, of which Sabic currently has a 53 per cent share.
A construction boom in the Gulf fuelled by increased revenue from oil exports is encouraging more steel producers to build steel plants in the region, where more than $1 trillion is earmarked for infrastructure projects. However, Sabic has decided against taking part in a $1.5 billion Mauritania iron project because returns would be too low.
Meanwhile, Sabic’s strategic business unit (SBU) continues to play a key role in the company’s diversified portfolio.
It includes and manages Saudi Iron and Steel Company (Hadeed) – the core of the metals group – along with Sabic’s stakes in Aluminum Bahrain (Alba), Gulf Aluminum Rolling Mill Company (Garmco) and the Sabayek ferroalloy smelter in Al Jubail.
Hadeed  produces direct reduction iron and steel billets/slabs, and long and flat steel finished products, and is the world’s largest producer of direct reduced iron in a single location.
It supplies customers in more than 30 countries around the world and aims through employee empowerment to establish itself ever more firmly as the preferred provider of a comprehensive range of steel products at competitive prices.
Sabic recently split the positions of Hadeed Metals president and vice-president – previously combined – into two separate posts, boosting Hadeed’s leadership capacity in order to better address the expansion challenges that lie ahead.
Last year saw the start of commercial operations at a new rebar and wire rod products plant, boosting Hadeed’s long steel products capacity by 500,000 tonnes a year.
The hot strip mill commenced commercial operations after completing the enhancement project designed to double flat production capacity to two million tonnes of hot rolled products. The expansion projects include a new direct reduction plant, steel plant and colour coating line. Between them, these projects are expected to raise production capacity to 5.5 million tonnes by the end of this year.
Sabic steel product sales during 2006 exceeded 2005 figures by six per cent, confirming Sabic steel’s status as the overwhelming local market leader, with a share of over 50 per cent.