Long an import-dependent nation for much of its steel requirements, Oman has since emerged as a net exporter of the commodity — a testament to the country’s growing manufacturing capabilities.
According to a senior executive of Jindal Shadeed Iron & Steel (JSIS), which owns and operates the Sultanate’s largest integrated steel mill at Sohar Port, Oman has made the important transition from being an importer of steel to a net exporter over the past five years.
“From 2015 to 2020, we have been able to turn Oman from an importer of steel — Oman was importing about a million tons (MT) of steel per annum — to a net exporter of steel; today we are exporting about 1.5 MT of steel per annum,” Sameer Gupta, Head of Production Planning, Shipping and Logistics, at Jindal Shadeed, said.
He made the revelation at a recent online webinar organized by Sohar Port and Freezone in collaboration with the Federation of Indian Chambers of Commerce & Industry (FICCI).
Jindal Shadeed, set up with an investment of around $1.2 billion, currently contributes around 1.5 percent of Oman’s annual Gross Domestic Product (GDP), said Gupta.
“We are proud to say that today we are the first and largest integrated steel plant in Oman,” he said. “We have invested close to $1.2 billion in Oman, having brought the latest steelmaking technology to this part of the world. Today, we manufacture about 1.8 MT of DRI (Direct Reduction Iron), 2.3 MT of steel and 1.5 MT of rebar (reinforced bars) every year.” A dedicated 600-meter-long jetty earmarked for Jindal Shadeed’s exclusive use at Sohar Port enables the exports of around 1 million tons of steel products, including rebars, to international markets every year, according to the executive. Export markets include those in North and South America, Europe, and for the first time this year, Australia as well. Around 3.5 MT of raw materials are also imported, primarily from India, for the project’s requirements, he said.
In his presentation, Gupta also underlined the plant’s unique capabilities that allow for the production of special types of steels. “We are the only plant in the GCC with a vacuum degassing facility which helps us in producing special grade alloy steels for use by downstream industries for special applications, such as in the manufacture of automotive parts.” Gupta credited Oman’s business-friendly investment environment, as well as Sohar Port’s strategic location, for the parent company, the Indian conglomerate Jindal Steel and Power, to acquire the existing project back in 2010.
“A steel plant like ours, with its large Capex-intensive unit, can only be profitable if it works 365 days a year; the efficiency we have been able to achieve in Sohar Port has been great. Besides, there are hardly any weather-related disruptions in Sohar, which helps us achieve an ambitious supply chain. Additionally, the connectivity that Sohar offers to Europe, Southeast Asia, and East Africa is tremendous. We can reach all of these places in less than two weeks, which is great for our business.” Gupta also noted that the Free Trade Agreement (FTA) between Oman and the United States has also been beneficial for the Jindal Shadeed project. The pact enabled the duty-free import of the main Direct Reduction (DR) plant from the US to the Sultanate at the start of its construction.
But he voiced hope that additional tariffs imposed by the previous US administration on steel imports — also known as ‘Section 232 Tariffs’ – would be repealed to help support duty-free exports to the American market.
“We are able to export rebars to the US from time to time. Hopefully, once Section 232 goes away, we will have a lot more opportunities. But we still have a couple of downstream customers who buy billets from us and turn them into steel sections and pipes and export them to the US. Yes, the US-Oman FTA is definitely a big plus for our sector,” he added.
Under Section 232 measures introduced on steel and aluminum imports by the former US administration, tariffs of 25 percent have been imposed on steel and 10 percent on aluminum.