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Surge in rebar demand strains Saudi Arabia’s steel supply chain

Saudi Arabia is witnessing a significant surge in demand for rebar, driven by the region's ambitious infrastructure projects and rapid urbanization.

Surge in rebar demand strains Saudi Arabia’s steel supply chain

In Saudi Arabia, the demand for rebar has surged as the nation presses forward with its ambitious infrastructure projects and urban development. Key construction initiatives, including Vision 2030 projects like NEOM and the Red Sea Development, are driving up the need for robust building materials, particularly steel rebar, essential for reinforcing concrete structures.
However, steel manufacturers are grappling with a supply crunch for critical raw materials. Scrap metal and semi-finished steel, which are fundamental inputs for rebar production, are becoming increasingly scarce. This shortage is complicating the supply chain, slowing down rebar production, and pressuring prices upward. Importing these materials has also become challenging as global steel producers compete for limited resources, adding strain to Saudi Arabia's steel industry.

Although the country's current rebar production capacity is 14.5 million tonnes per year, there are serious shortages in the supply of scrap and semi-finished products.

Industry experts are calling for a strategic focus on boosting local scrap collection and expanding recycling facilities to alleviate these shortages. Until then, the limited availability of steelmaking raw materials is likely to create a challenging environment for Saudi Arabia’s construction sector, potentially impacting timelines and costs for large-scale projects.

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