Gulf fertilizer production increases 4% in 2013

08/07/2014 08:32 AST

Riyadh Dry Port has the shortest dwell time among all other ports in Saudi Arabia, taking an average of 5-7 days for the containers to be delivered to the consignee.

JEDDAH – Fertilizer industry in the Gulf region is growing twice as fast as the global industry average led by the increased investments from petrochemical producers, said the Gulf Petrochemicals and Chemicals Association (GPCA).

According to GPCA estimates, GCC’s fertilizer production capacity reached 42.7 million tons in 2013, a 4 percent increase from the previous year, while the global fertilizer industry grew by just 1.7 percent in the same period. Capacity growth was achieved with several multimillion dollar projects in Saudi Arabia, Qatar and the United Arab Emirates coming on-stream.

“In 2013, GCC producers exported 20 million tons of fertilizer products to more than 80 countries worldwide,” said Khalifa Al-Sowaidi, Chairman of the GPCA’s Fertilizer Committee and Chief Executive Officer of Qatar Fertilizer Company (QAFCO). “The GCC industry accounted for approximately one-quarter of global urea trade and for 12 percent of the global ammonia trade volume in 2013. With double digit capacity growth over the last five years, the GCC industry has demonstrated its potential to be a major global player.”

With the world population projected to reach over 9.3 billion people by 2050, the International Fertilizer Industry Association (IFA) predicts that world food production has to increase by 60 percent to feed the world’s future generations.

“The growth in population and the need to accelerate food production represents a major opportunity for the GCC’s fertilizer producers,” Al-Sowaidi said. “As an export oriented market that exports more than 90 percent of its nitrogen fertilizers (ammonia and urea) to the Far East, the GCC fertilizer industry can make a major global contribution to addressing food security challenges by providing access to and efficient use of inputs and resources.”

While analysts have predicted of a slowdown in growth due to the availability of cheaper feedstock elsewhere, particularly due to the shale gas revolution, the GPCA forecasts that region’s fertilizer capacity will continue to grow at a steady pace.

“Several multibillion dollar projects will be completed in the next years, which will strengthen the GCC’s fertilizer capacity to over 66 million tons by 2018,” said Dr. Abdulwahab Al-Sadoun, Secretary General, GPCA. “In addition, the industry will further diversify its products portfolio to ensure its long-term competitiveness and profitability.”

To support the region’s fertilizer industry, the GPCA will host its fifth annual Fertilizer Convention on Sept.16-18, 2014 in. Discussions will focus on how fertilizers contribute to global food security.

Saudi Gazette