GCC steel suppliers reinforce presence in the market

March 10, 2010

The current price of steel in the UAE has seen a monthly increase from December 2009 to reach AED 2,150 per tonne in March this year - a growth pattern that is posing major prospects for the regional market in terms of its implications on the capacity of mills to operate at full capacity, according to Danube Building Materials, the leader in construction, building materials and shop fitting industries. The company further revealed that scrap prices continue to firm up, costs of raw materials steadily increase, and billet availabilty is constrained. Further price hikes are likely in the coming months, thereby prompting local steel suppliers to strongly reinforce their presence in the regional market. The steady price hike in the region, however, is not in tandem with the steep levels by which global steel prices are rising, which is a reflection that the steel market in the region is becoming indifferent to global market forces and thus continues to have a significant lag behind price surges in other parts of
the world.

The price of steel in the UAE started its recent climb from a rate of AED 1,780 per tonne in November-December 2009, to AED 1,850 in January 2010, to AED 1,950 in February, and to its present rate of AED 2,150 per tonne. Comparatively, global steel (mill) prices have gone from USD 490 (December 2009) to USD 520 (January 2010) to USD 535 (February 2010) to USD 570 (March 2010), and latest estimates reveal that a price of USD 600 is imminent. The region’s indifference to the rate of increase seen in global prices is partly due to weak demand, as a result of some major projects in the Middle East being delayed or put on hold. Furthermore, liquidity in payment remains tough, with most contractors and developers unable to commit to immediate payments for suppliers in the region.

“The local steel market required up to 400,000 tonnes of steel per month in the years prior to the recession but this has reduced to 250,000 tonnes per month on account of the international economic downturn,” said Rizwan Sajan, Chairman, Danube Building Materials. “The increasing role played by GCC-based steel suppliers, which has curbed the flow of Turkish steel into the country, is also an indicator of the increasing growth potential for the regional steel industry. We remain optimistic that steel prices in the region will increase to reach its ideal level, which is somewhere around AED 2,300 - 2,400 per tonne, and this will provide a boost to the mills, which have been affected by the recession to gain full operation capacity and thereby stabilise the market.”

At present, top UAE-based suppliers Emirates Steel Mills and Qatar Steel Corporation dominate the regional supply chain, delivering a combined 175,000 tonnes of steel (125,000 tonnes and 50,000 tonnes, respectively), to the UAE. With scrap traders holding on to existing stockpiles and a lower collection of scrap over the past few months, steel prices in the region have increased at rates of close to 12 per cent in the last month. Whilst billet availability remains another issue in the region, Danube is confident that the current steel prices are a realistic reflection of the market and bode well for the remainder of the year.

“The global market has seen steel prices drop to an all-time low of USD 390 back in 2008, while prices in the region had hit the bottom price of AED 1,750 per tonne in 2009. During these periods, the steel industry has had major difficulties coping with the closure or slowing down of mills. The increase in prices we are monitoring in the UAE and the rest of the region is suggestive of positive developments in the stability of the steel industry, and we are watching for further indicators to help us leverage this excellent progress,” concluded Sajan

HH Sheikh Hamdan Bin Zayed Al Nahyan officially supports the forum

Abu Dhabi, UAE. – 20th February 2010 – A host of leading local and international industry experts are expected to speak at The Global Logistics Forum to be held on new dates 15th and 16th March, 2010, at the Fairmont Bab Al Bahar, Abu Dhabi, who will address the growing demand for logistics services and infrastructure in the Middle East.

Held under the patronage of His Highness Sheikh Hamdan Bin Zayed Al Nahyan, the Rulers Representative in the Western Region, the forum aims to bridge the gap between the global supply chain industry and the regional logistics sector. The forum organised by Aim, the Events Management Division of Abu Dhabi University, will also discuss subjects related to customising local requirements of infrastructure projects, and the development of the global logistic services in the Middle East region

According to the International Logistics Performance Index’s cross-country comparison, the UAE presently ranks the highest in the region in terms of performance within the logistics and supply chain industry, marking 3.63% growth during 2009. Bahrain follows in second place at 3.37%, and Kuwait comes third at 3.28%.

“With the outbreak of developmental projects in the tertiary sector, there is now, more than ever, a need to understand the strengths, weaknesses, opportunities, risks, and success factors from a local and global point of view,” said James Graham, General Manager, Aim.  “The Global Logistics Forum is an ideal platform for the integration of ideas from the best minds in the industry, and it paves the way for not only the conception of innovative solutions in logistics, but also ensures that these are brought to reality.

“The speakers at this year’s Global Logistics Forum will collectively bring a wealth of knowledge and understanding about ever-changing strategies within the logistics industry, and attendees will benefit from their shared insight on what is required not only to fulfil the objectives of the Abu Dhabi Economic Vision 2030, but also to succeed in the global market,” Graham added.

Resulting from a long-term strategic partnership between the Abu Dhabi University and the Berlin Institute of Technology (TU-Berlin) Chair of Logistics, an internationally renowned university in Germany, the Global Logistics Forum is a step towards the development of a long term, high quality programme of courses, events and knowledge transfer within the field of supply chain logistics.

Among the main speakers is Mohamed Al Shamsi, Port Unit Vice President, Abu Dhabi Ports Company, who will discuss the future of the country’s logistics industry in parallel with the objectives of the Abu Dhabi Economic Vision 2030, and Professor Dr. Stephan Reimelt, Chief Executive Officer, IPIC Ferrostaal Contracting, and member of the Executive Board, MAN

Ferrostaal AG will provide an understanding of the factors that bring success to local projects run by global players at the forum.

Meanwhile, Professor Dr. Eng. Frank Straube, member of the Management Board of the European Logistics Association, will account the varying global logistics strategies within different sectors and industries, and their resulting impact on the global logistics industry. On the other hand, Peter Glatz, Chief Executive Officer, Schenker Middle East, is set to highlight the challenges, potential developments, customer requirements and the success factors for global business developers in the logistics industry in the Middle East.

The two-day event, which was to be originally hosted on 8th and 9th February, 2010, has been postponed to meet the requirements reflected by the growing level of interest in the forum. It will also include three interactive workshops involving various visits to significant infrastructure locations and logistics service providers, as well as provide an ample opportunity for networking with the brains of the industry from the region and from around the world. The forum will bring together global supply chain leaders, logistics managers and the local and international policy makers from the local and global logistics industry. 

Furthermore, speaking about how the Middle East can support and benefit from the success of global companies’ supply chain is Professor Dr. Hans-Christian Pfohl, Technische Universität Darmstadt, and member of the Board of the European Logistics Association. Discussing the impediments of growth in the Middle East will be Frederic Hendrick, Chairman of the Management Board of the French Logistics Association (ASLOG), Alstom. Professor Lauri Ojala, Research and Education Turku School of Economics, Finland, will talk about the methodology of the Logistics Performance index and what the “best” countries do differently.

The forum is supported by the Institute for Vocational Development, a member of the Abu Dhabi University Knowledge Group; The Chartered Institute of Logistics and Transport; and German Logistics Association. For more information about the event, please visit www.globallogisticsforum.com.

• Innovative fund-of-funds up more than 41 per cent for full year; one of top-performing commodity funds among all funds-of-hedge-funds and Shariah-compliant funds-of-funds
• Gold Fund receives ‘Outstanding Performance & Innovation Award’ from MENA Fund Manager; fund up nearly 68 per cent in 2009
• Global Resources and Mining Fund up 55 per cent; Energy Fund up 41 per cent; Natural Resources Fund records nominal gains

DSAM Kauthar Commodity Funds record industry leading growth in 2009

Dubai, January 26, 2010: Highlighting the sound underlying investment strategy of its fund managers and innovative product development strategy, Dubai Multi Commodities Centre Authority (DMCCA) announced today that its Shariah-compliant Dubai Shariah Asset Management (DSAM) Kauthar Commodity Funds recorded industry leading gains in the 12 months ending December 31, 2009.

The DSAM Kauthar Commodity Fund (DKCF), an equally-weighted fund-of-funds comprised of four single-strategy, commodity-focused funds that invest exclusively in Shariah-compliant long/short equity hedge funds on the Al Safi Trust platform, was up 41 per cent at the end of last year. During the same period, DKCF managers returned roughly double the average return of their equity and commodity benchmarks. The fund-of-funds total assets under management stood at US$250.1 million as of December 31, 2009.

In 2009, the DKCF was one of the top-performing commodity funds among fund-of-hedge funds globally, based on Bloomberg and Eurekahedge data.  DKCF ranked in the 99th percentile of the Bloomberg Active Index for Islamic Funds as well as the 99th percentile of the Eurekahedge Fund of Funds Index.  Indeed, excluding funds with less than US$100 million in assets, the DKCF is the top-performing commodity fund-of-funds and the leading Shariah-compliant fund-of-funds, according to hedgefund.net. 

The Al Safi Trust is a comprehensive Shariah-compliant platform designed specifically for hedge funds and launched by Barclays Capital and Shariah Capital.  Distributed under the DSAM Kauthar label, the four funds underlying the index have been seeded with US$50 million each by DMCCA.

In addition, DMCCA announced today that its DSAM Kauthar Gold Fund, one of four funds distributed under the DSAM Kauthar label, has received the “Outstanding Performance & Innovation Award” from MENA Fund Manager, the region’s leading industry title.

For the full year 2009, the gold fund was up nearly 68 per cent, ranking #1 out of 344 Islamic funds followed by Eurekahedge, representing all investment strategies and markets from around the world. The DSAM Kauthar Gold Fund also ranked first globally out of 673 hedge funds with between US$50-250 million in assets under management, according to HedgeFund.net. 

The DSAM Kauthar Global Resources & Mining Fund, which recorded gains of more than 55 per cent in 2009, is ranked in the 99th percentile of the Reuters Lipper TASS Energy Index, putting it in the top 10 of 2,150 funds reporting to Lipper. Meanwhile, the DSAM Kauthar Energy Fund was up 41 per cent as of December 31, 2009. Finally, the DSAM Kauthar Natural Resources Fund was up slightly more than three per cent at the end of the same period.
 
“At DMCCA, we are committed to supporting the expansion of the Islamic financial services sector, and our innovative DSAM Kauthar Funds represent the future for that high-growth sector,” said Ahmed Bin Sulayem, Executive Chairman, DMCCA. “We are aware that these relatively new products were launched during a global downturn, and recognise that investors are now understandably conservative in their approach. Therefore, we will continue to focus on educating the market, highlighting to investors the sterling performance of the funds and underscoring their long-term appeal.”

“The award-winning performance of the DSAM Kauthar Gold Fund as well as the exceptional gains recorded by the DSAM Kauthar Global Resources & Mining Fund and Energy Fund place them at the top of worldwide indices,” said Malcolm Wall Morris, Chief Executive Officer, DMCCA. “These cutting-edge, Shariah-complaint alternative investment products have been specifically developed to meet the needs of regional investors, while also appealing to conventional institutional investors. Based on past performance, we are confident that we will continue to expand and diversify our client base in 2010.”

“The strength of our fund managers, who were selected on the basis of their outstanding track record in commodities over the past two decades, is clearly second to none,” added Eric Meyer, Chairman and Chief Executive Officer, Shariah Capital. “Each of the partners involved in the development and marketing of these exceptional products is extremely proud of our success in 2009, and we look forward to sustaining our performance in the 12 months to come.”

Public figures and citizens urged to serve as ‘Brand Ambassadors’ in line with creative initiatives to promote Lebanon, says branding expert Read the full story