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Oman’s Aluminum Unwrought Market Outlook Report

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Aluminum smelters (unwrought producers) fall into two categories: primary and secondary smelters. Molten aluminum cast as unwrought products can be produced either through alumina electrolysis in primary smelters or through remelting scrap and pure ingots in secondary smelters. Primary smelting is a cost-intensive process; thus, such plants are usually large-scale producers that can be economical with large capacities. But remelting aluminum in secondary smelters requires much lower costs, making small-scale capacities economical.

Aluminum smelting and the production of unwrought aluminum in Oman have mainly started after primary smelting began and Sohar’s smelters came online. Sohar Aluminium Company was established in 2004 and operations started since 2008. Accounting for almost two thirds of the country’s total unwrought output, Sohar offers its products to the market mainly as ingots or T-bars; however, the largest part of the company’s domestic sales is in the form of hot metal to downstream plants nearby, with ingots and T-bars being mostly exported. The other one third of the country’s unwrought output is by secondary smelters that produce alloys. Unwrought products such as slabs and bus bars are the most important ones produced by secondary smelters in Oman.

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Product Description

With a per-capita GDP of $32,400 in 2019, Oman was the fifth largest economy in the region that year, behind Qatar, the United Arab Emirates, Bahrain, and Saudi Arabia. The country’s economy has steadily grown over the past years, and according to the Oman Vision 2040, economic growth is expected to continue over the coming years. The country’s logistical location that connects the Gulf Cooperation Council (GCC) countries to the world is one of the major factors in expanding its relations and trade with other countries; the free trade agreement with the US since 2009 is one example. Oil and petrochemicals account for a major portion of the country’s exports. In 2019, about 70% of the country’s total export revenues came from oil and oil-related products. Iron and steel as well as organic chemicals are also major contributors to the country’s total exports. The aluminum industry has moved up to the fifth place in the country’s exports and has had significant growth and development in downstream capacities over the recent years. A considerable portion of downstream capacities are located near the country’s primary smelter Sohar, which has an annual capacity of 375 thousand tonnes; this makes hot metal easily available to downstream producers, reducing their costs.

Market drivers of unwrought aluminum

The high electrical and thermal conductivity of aluminum combined with its price advantage over copper have turned it into a major substitution threat for the red metal. Aluminum is becoming even more attractive as copper prices continue to rise and the price spread with copper widens. Currently, conductors and radiators are two of the most important cases of copper consumption that have been replaced by aluminum.

With the low-cost availability of energy in the Middle East as the major driver of primary capacity development in the region, the availability of raw materials for downstream plants has improved. As one of the countries involved in the oil and gas industry, Oman has seen developments in downstream sectors after the Sohar smelter was built as a joint venture between Rio Tinto and another company from the UAE. With the Oman Vision 2040, the trend is expected to continue over the long term. This can boost demand for unwrought aluminum in the country.

Although the share of manufacturing in Oman’s economy has increased over the past years, it is still contributing a small part to the overall economy. In 2019, added value from manufacturing had a share of only 10% in the country’s total GDP, which is small compared to other regional countries in the aluminum industry. Moreover, the country’s small population has translated into a smaller domestic market. This will limit demand growth for aluminum and unwrought aluminum as well.

Oman reported its first case of Covid-19 in late March 2020. Before long, in April, social distancing and lockdowns were implemented. As a result, the country’s mobility index dropped more than 30%. As the pandemic continued to spread, lockdowns were extended into mid-April, but activities were gradually resumed under certain protocols. Lockdowns are expected to continue, significantly disrupting industrial performance and eventually leading to a decline in demand for aluminum semis; a recovery might be likely in the near term.

Overview of Oman’s unwrought aluminum market

Oman’s aluminum industry has steadily grown following the commission of the Sohar smelter. Yet, a large part of the smelter’s output is exported as ingots and T-bars. As downstream plants developed, secondary smelting capacities grew until they exceeded half of Sohar’s 375,000-tonne-per-year capacity over the recent years. However, demand for unwrought alloys has increased to the point where even the growing output of secondary smelters is not enough to meet that demand; thus, Oman’s demand is met partly through imports. Although this has led to a negative trade balance in unwrought aluminum alloys over the past few years, the trade balance is expected to gradually move into positive territory as secondary smelting capacities are developed and operating rates at existing secondary smelters increase.

Breakdown of Oman’s unwrought aluminum market

Domestic demand for unwrought aluminum (for both primary and secondary products, separately) in the forecast timeframe as well as the previous period has been broken down using three factors. The first factor breaks down the market into three categories based on alloy material: commercially pure aluminum, heat-treatable alloys, and non-heat-treatable alloys. Past and future trends for each type of material have been analyzed. Commercially pure aluminum holds the largest share of the market for primary unwrought aluminum; in the secondary market, heat-treatable alloys take the largest share. In the second breakdown, products are distinguished based on product type: ingots, billets, and slabs. A major portion of primary unwrought products are ingots, while billets are the most common form of secondary unwrought. Finally, using the third factor, unwrought aluminum is categorized based on consumption. Secondary smelters are the largest consumers of primary unwrought aluminum, while extrusion plants are the largest consumers of secondary unwrought aluminum.

Key players in Oman’s unwrought aluminum market:

  • Sohar Aluminium
  • Oman Aluminium Cast LLC (OAC)
  • Omani Indian Co. for Aluminum Recycling LLC

Additional Information

Industry

Aluminium Casts
Region

Oman
Report Type

Industry Report

Specifications

Report Attribute Details
The base year for estimation 2019
Historical data 2009-2018
Forecast period 2020-2025
Quantitative units Value in USD and Volume in Tonne
Report coverage Market Overview, Dynamics, Market Outlook, Risks to Forecast, Consumer Market, Industry Overview, Market Landscape, Competitive Landscape, Market Attractiveness, External Macro Environment Analysis
Segments covered Source, Composition, Type, Application
Pricing and purchase options Please explore our purchase options to meet your exact research needs.

Reasons to Buy

  • Recognize the geographical distribution of import demand
  • Identify the current and future key players of the trading market
  • Achieve a better insight on potential target markets
  • Understand the behavior of major suppliers/customers either globally or regionally
  • Identify competitors as a feed for market analysis

Table of Content

  1. Executive summary
  2. Introduction
    • Objective
    • Market under study
    • Product
      • Product specifications
      • Consumption structure
        • Applications
        • Physical properties
      • Subjects discussed
      • Geographical scope under study
      • Study timeframe
      • Study currency
      • Potential audience
  1. Market dynamics
    • Market drivers
    • Restraints
    • Opportunities
    • Challenges
  2. Market overview
    • Market size
    • Industry capacities
      • Existing capacities
        • Capacity distribution
        • Geographical distribution of capacities
      • Future capacities
    • Output
      • Output trends
      • Operating rates
    • Consumption
      • Consumption trend
      • Consumption Share of domestic product
    • Trade
      • Exports
      • Imports
      • Trade balance
      • Market balance
    • Market breakdown by product type
    • Market breakdown by product type
    • Market breakdown by application
    • Inventory
      • Producers inventory
      • Consumers inventory
      • Traders inventory
  1. Market outlook
    • Market factors
      • Raw materials
      • Costs and prices
      • Competition
      • The government
      • Other factors
    • Future scenarios
    • Risks to forecast
  2. Consumer markets
    • End-user markets
      • Building construction
      • Infrastructure construction
      • Transportation manufacturing
      • Industrial equipment manufacturing
      • Durable goods manufacturing
      • Consumable goods manufacturing
    • Direct consumer markets
      • Major Direct consumers
        • Existing capacities
        • Drivers
  1. Export potentials
    • Destinations
      • Trade and insurance costs
      • Import market suppliers
      • Producers potential share
  1. Industry overview
    • Raw materials
      • The supply volume of raw materials
      • Supply channels of raw materials
      • Raw materials procurement costs
    • Cost structure of producers
    • Production cost curve
    • Industry value added
    • Generated new scrap
    • Technology
  2. Market landscape
    • Domestic sales markets
      • Pricing in the domestic market
      • Potential domestic demand
      • Trade agreements for imports
      • Foreign suppliers
    • Foreign sales market
      • Prices
      • Potential markets overview
      • Trade agreements for exports
      • Foreign customers
  1. Competitive landscape
    • Producers
      • Company profile
      • Revenue structure
      • Gross profit margins
      • Capacity, output and sales
    • Consumers
      • Company profile
      • Revenue structure
      • Gross profit margins
      • Capacity, output and sales
  1. Market attractiveness
    • Industry rivalry
    • Threat of new entrants
    • Threat of substitutes
    • Bargaining power of buyers
    • Bargaining power of suppliers
    • Conclusion of Porter analysis
  2. PESTEL analysis
    • Political factors
    • Economic factors
    • Social factors
    • Technology factors
    • Environmental factors
    • Legal factors
  3. SWOT analysis
    • Large-scale companies with favorable conditions
      • Short-term strategies
      • Long-term strategies
    • Large-scale companies with unfavorable conditions
      • Short-term strategies
      • Long-term strategies
    • Small enterprises with favorable conditions
      • Short-term strategies
      • Long-term strategies
    • Small enterprises with unfavorable conditions
      • Short-term strategies
      • Long-term strategies

List of Figures

  1. Output and consumption; 2009-2018
  2. Market share of product applications; 2018
  3. Market surplus; 2019-2025
  4. Production process flowchart
  5. Market size; 2009-2025
  6. Existing capacity; 2009-2018
  7. Capacity distribution; 2018
  8. Geographic distribution of capacities; 2018
  9. Development of future capacity; 2009-2025
  10. Amount of output; 2009-2025
  11. Operating rates of production plants; 2009-2025
  12. Amount of consumption; 2009-2025
  13. Consumption share of domestic product; 2009-2025
  14. Exports of product; 2009-2018
  15. Imports of product; 2009-2018
  16. Historical trade balance; 2009-2018
  17. Future Market balance; 2021-2025
  18. Market output breakdown by alloy type; 2009-2025
  19. Market consumption breakdown by alloy type; 2009-2025
  20. Market balance breakdown by alloy type; 2009-2025
  21. Market output breakdown by product type; 2009-2025
  22. Market consumption breakdown by product type; 2009-2025
  23. Market balance breakdown by product type; 2009-2025
  24. Market consumption breakdown by application; 2009-2025
  25. Inventories of raw materials and products at producers factories; 2009-2018
  26. Consumers’ inventory of product; 2009-2018
  27. Traders’ inventory; 2009-2018
  28. Production forecast, according to raw materials and sales analysis; 2019-2025
  29. Market surplus; 2019-2025
  30. The share of end-user industries in the consumption; 2009 and 2018
  31. Changes in the end-consumption of extrusion products; 2018 vs 2025
  32. Applications in building construction industry; 2018
  33. Applications in infrastructure construction industry; 2018
  34. Applications in transportation manufacturing industry; 2018
  35. Applications in industrial equipment manufacturing industry; 2018
  36. Applications in durable goods manufacturing industry; 2018
  37. Applications in consumable goods manufacturing industry; 2018
  38. Capacity distribution structure of direct consumers; 2018
  39. Existing capacities of direct consumers in each province; 2018
  40. Suppliers of the export potential destination; 2018
  41. Historical exports to the export potential destination and future potential; 2016-2025
  42. Up-stream domestic supply; 2009-2018
  43. Raw materials domestic supply; 2009-2018
  44. Supply channels of producer plants
  45. Spot price of raw material in the market; 2009-2025
  46. Cash cost structure for production the product; 2018
  47. Production cost curve of the plants; 2018
  48. Gross value added of the industry; 2009-2018
  49. Generated new scrap; 2009-2018
  50. Sales channels
  51. Realized price of the product in the market; 2009-2025
  52. Potential demand of each province; 2018
  53. The main foreign suppliers to the market; 2009-2018
  54. FOB price vs domestic market; 2009-2025
  55. Map of global major importers > 20,000t; 2018
  56. Major foreign customers; 2009-2018
  57. Revenue structure of the producers; FY2018
  58. Sales income and gross profit margin of the producers; FY2009-2018
  59. Output and sales of the producers; FY2009-2018
  60. Revenue structure of the consumers; FY2018
  61. Sales income and gross profit margin of the consumers; FY2009-2018
  62. Output and sales of the consumers; FY2009-2018
  63. SWOT matrix for large-scale companies with favorable conditions
  64. Strategies positioning for large-scale companies with favorable conditions
  65. SWOT matrix for large-scale companies with unfavorable conditions
  66. Strategies positioning for large-scale companies with unfavorable conditions
  67. SWOT matrix for small enterprises with favorable conditions
  68. Strategies positioning for small enterprises with favorable conditions
  69. SWOT matrix for small enterprises with unfavorable conditions
  70. Strategies positioning for small enterprises with unfavorable conditions

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