As a result of the construction boom the iron and steel industries have posted record outputs.

The projected expansion of economic infrastructure in Saudi Arabia and other GCC states is very good news for the steel industry. Major construction projects like the kingdom’s new economic cities and refineries will require huge quantities of steel and local manufacturers are raising production levels to keep the pace with rising demand.

Arab iron and steel manufacturers achieved a record output of 19 million tons last year, with GCC companies leading the way. Saudi firms contributed 5.2 million tons – around 67 per cent of the 7.8 million tons produced in the Gulf region.

Saudi Iron and Steel Company (Hadeed), the largest manufacturer of steel products in the kingdom, plans to boost its production capacity to 10 million tons over the next ten years.

While domestic and regional demand continues to increase, opportunities for Saudi steel companies also exist in other fast developing countries, such as Pakistan and India.

The Al-Tuwairqi Group, a leading Saudi producer, has expanded beyond the kingdom, where it has five factories, setting up a SR1.1 billion (£160 million) state-of-the-art steel-making plant in Pakistan at Bin Qasim, Karachi, and buying 30 per cent of the Pakistan Steel Mills in partnership with the Arif Habib Group of Pakistan and Magnitogorsk Iron and Steel Works (MMK) of Russia.

The strategic location of the plants will enable Al-Tuwairqi to cater to the demand not just in Pakistan but also in Afghanistan, where reconstruction will require an extensive supply of steel.

In 2003, Al-Tuwairqi acquired the Sheerness melt shop and other assets of the Kent company Thamesteel. SMS Meer of Italy was contracted to supply a bar mill plant designed for an annual capacity of up to 600,000 tons of steel products.
Closer to home, Al-Tuwairqi is building a steel mill in neighbouring Bahrain, while in the kingdom itself it has been constructing a new complex in Jeddah.

From humble beginnings almost 30 years ago, Al-Tuwairqi has developed into one of the top 50 Saudi companies. The group is involved in the trading and distribution of industrial and building materials throughout Saudi Arabia and, in addition to steel production, has interests in electrical equipment and appliances, space frame manufacturing, air conditioning equipment and installation, and information technology services.

The Al-Ittefaq Steel Products Company (ISPC), the group’s flagship enterprise, has advanced from its initially modest production 15 years ago to a capacity of 1,250 million tons today. Adjacent to the factory in Dammam, Al-Tuwairqi has recently been rebuilding the first of two 400,000 tons-per-annum Midrex direct reduction plants bought from the US company Corus and shipped over from Alabama. This is due to go into production this year with plans for the second module to become operational next year.

Another recent technologically advanced addition to the group’s steel-making facilities is the National Steel Company Limited (Nasco), a steel melt shop that uses the electric arc furnace melting method to produce steel billets.

Al-Tuwairqi’s latest line of business is to manufacture steel rails for the extension of the Saudi railways network, in particular the Landbridge project linking Jeddah and Dammam.

Mr. Ali Al-Naimi, Minister of Petroleum and Dr. Hilal H. Al-Tuwairqi, Owner and Chairman

PM Communications: Al Tuwairqi Group has been one of the flagship companies in the Eastern Province for the last thirty years and is amongst the top thirty Saudi Companies. You achieved this through hard work and a lot of dedication. Could you tell us what is the key to this success?

Dr. Hilal Al Tuwairqi- ALTUWAIRQI GROUP: First of all, it is not only in the Eastern Province, but also in the whole Kingdom of Saudi Arabia. Secondly, it is not a one-man show; we are a group of people. At this point we can admit we have succeeded. But we still have a long way to go until we reach our goal.

God's blessing and the family's spirit made this possible. When I talk about family I mean the group of people working with each other as a family. Our asset is not the factories; our Asset is the people. We are all the same, and we believe in honesty, dedication and truth.

PM Communications: You are the pillar of this company. You started it if from scratch and you developed the business; you knew exactly where you wanted to go. Today it is a very successful diversified group with interests ranging from contracting to steel. You bought many factories in Pakistan and one in the United States. This has a lot to do with you being the center of the company.

Dr. Hilal Al Tuwairqi- ALTUWAIRQI GROUP: Yes, but I insist; it is not a one-man show. When I started the business, long time ago, it was a one-man show, but only because it was the size of a one-man show. Then I got together with my colleges and my brothers, and now we are more than two thousand people. This is excluding Pakistan Steel, because Pakistan Steel alone employs about thirteen thousand people.

I see it as a joint effort. I would not give the credit to myself. The credit has to be distributed between everyone in the group, since we all share the same vision. If any one among the family members irrespective of his position has a vision, he will advice me about it, and I will look at it and discuss it with him. Then, I will either implement his vision, or I will give him green light to implement it by himself. I will give him not only the opportunity, but also the trust, because we are one family. Do you think that Maradona can win the cup alone? No, it is all about teamwork.

PM Communications: What can you tell us about your recent acquisition of Midrex Technologies?

Dr. Hilal Al Tuwairqi- ALTUWAIRQI GROUP: Midrex Technologies had been shut down and was for sale, so we bought it. I brought it here, and after three months it will be in operation.

PM Communications: And how will the second phase, in 2007, change the production?

Dr. Hilal Al Tuwairqi- ALTUWAIRQI GROUP: When we started, we were relying on raw material. Now we create our own raw material by melting 80% of iron ore or sponge iron with 20% of scrap, and it is even cheaper. We are selling within Saudi Arabia, but we are putting another mill, a big one, in Bahrain. We are developing another complex in Sharja, in the United Arab Emirates, and we are building two more here, in Saudi Arabia.

So we will be having here four "DRI" and three palatisation plants. We will have three melt shops, flat products, coils, rails, and steel. Saudi Arabia is now connecting the whole country with rails, and this network will expand to reach all GCC, so we will be manufacturing rails for this purpose. We are building a complex in Jeddah with capacity for over three hundred thousand tons and by the end of this year it will be 1.7 million ton pairs. Saudi Arabia is absolutely booming, and we cannot build anything without steel.

PM Communications: In what ways will the new factory in Pakistan improve your international presence?

Dr. Hilal Al Tuwairqi- ALTUWAIRQI GROUP: We have two different things in Pakistan. On one hand, we have our own Al Tuwairqi Steel business, which has been inaugurated by His Excellency, President Pervez Musharaf. Our second project is an alliance with the Arif Habib Group from Pakistan, and MMK from Russia. Together, we have acquired 75% ownership of Pakistan Steel, which is located in Ben Qasim Seaport and is spread over twenty-two million square meters. At the moment they are producing 1.1 million tons, and our vision is to bring that production up to over three million tons in a short time. Al Tuwairqi Steel is very close to it, with over a million square meters. Moreover, they are using the latest "DRI" technology.

We are in the free zone, and we can fulfill the demands of Pakistan, which is also booming. For example, Afghanistan does not have a border or a seaport. So anything they want to import comes either by India, which is a long way, or through Karachi. So we will be there to fulfill the growing demands for infrastructure building of Afghanistan.

PM Communications: Do you have any plans to expand in the region?

Dr. Hilal Al Tuwairqi- ALTUWAIRQI GROUP: Yes; Afghanistan will be rebuilt, and the only seaport close is Karachi. So we will cater the needs. To rebuild it, they need two basic things: steel and cement. We do not have a cement factory, but we can participate in the export.

China, for example, does not need us. Actually, the whole world will need China! But our vision is to acquire shares in every government-owned entity in the steel sector willing to be privatized. For example, in Indonesia there is a huge complex called Krakatau. It belongs to the Government, and it can make a lot of money if they allow business people to manage it. I will visit Indonesia in two weeks and I will have the honor to meet the President, who was here just two days ago. Moreover, I will have a meeting with the Minister of Industry to talk about an alliance similar to the one in Pakistan.

Al Tuwairqi's vision is to participate in the development of National economy by creating an industrial economy as parallel substitute in order to have a long and sustaining growth of our beloved country. We are looking to create for our younger generations the job opportunities to build a strong and prosperous Nation on the face of this planet.