Dubai – MENA Herald: With the GCC’s fertilizer industry doubling its capacity in the last decade, earning US$6.5 billion in revenues in 2014, the sector must evolve in traditional and new export markets to realize its growth potential, advised the Gulf Petrochemicals and Chemicals Association (GPCA) ahead of the Fertilizer Convention, which opens today.
“As an export-oriented industry, the performance of fertilizer producers in the Arabian Gulf is highly dependent on global demand,” said Dr. Abdulwahab Al-Sadoun, Secretary General, GPCA. “The GCC’s fertilizer companies have strong potential in their traditional markets as well as the new ones in Africa, building on established marketing, sales and supply chain capabilities.”
Fertilizer capacity in the Arabian Gulf grew to 40.8 million tons in 2014, a 3.8% increase from the previous year, earning revenues of US$6.5 billion, according to the latest research in the GPCA’s Fertilizers Indicators report.
With a production capacity of 17.2 million tons and 10.7 million tons respectively, Saudi Arabia and Qatar lead fertilizer production in the region. Meanwhile, the United Arab Emirates is the GCC’s third largest fertilizer producer holding a portfolio of 5 million tons, a capacity that has grown by more than 50% in the last 10 years.
However, global developments in access to feedstock and technological advancements may affect the growth trajectory of regional fertilizer producers in the next decade.
“The fact of the matter simple: global competition is intensifying,” explained Dr. Al-Sadoun. “From the introduction of shale gas in the United States to technologies like coal to olefins in China, major importers of GCC fertilizers are now evolving to a place where they are self-sufficient in certain chemicals that are crucial for the production of these products—a commodity they would usually import from GCC producers, meaning that there is a possibility for this demand to dwindle in the near future. Looking ahead, innovations in feedstock and diversification of the products portfolio will be crucial for the continued growth of this industry.”
The topic of innovation will be a key focus at the upcoming GPCA Fertilizer Convention. Held on the theme of “Innovating for growth: Ensuring an efficient, sustainable future”, the conference will shed light on how the GCC’s fertilizer industry can contribute to global food security while embracing an environmentally sustainable future.
The Fertilizer Indicators report will be released at the GPCA Fertilizer Convention today. Now in its 6th edition, the conference concludes on September 16.
For more information, please visit http://gpcafertilizers.com/2015/