KSA Iron & Steel Casting Market Outlook to 2028

KSA Iron & Steel Casting Market Overview

The KSA Iron & Steel Casting Market has seen substantial growth which was reflected in the global iron and steel market valued at USD 160 billion in 2023. This growth is driven by increasing infrastructure projects, industrialization, and urbanization in the Kingdom of Saudi Arabia (KSA). The demand for high-quality cast iron and steel components in the construction, automotive, and manufacturing sectors is a driver for this market.

The KSA iron & steel casting market is highly competitive, with major players like Saudi Iron and Steel Company (Hadeed), Rajhi Steel, and Zamil Steel dominating the market. These companies have established a strong market presence through continuous investments in production capacities and advanced technologies.

Saudi Iron and Steel Company (Hadeed) announced an expansion plan in 2023 to increase its production capacity by 20% by 2025. This expansion is set to boost the company's output to 6 million tons per year, addressing the growing demand in the domestic and regional markets.

The Eastern Province of Saudi Arabia, including Dammam and Jubail, dominates the iron and steel casting market, accounting for the majority of the market share in 2023. This dominance is due to the presence of major industrial hubs and proximity to key raw material sources.

KSA Iron & Steel Casting Market Segmentation

KSA's iron & steel casting market is segmented into product type, application, and region.

By Product Type: The KSA Iron & Steel Casting Market is segmented by product type into Gray Iron Castings, Ductile Iron Castings, and Steel Castings. In 2023, gray iron castings dominated the market due to their excellent machinability and wear resistance, which contributed to their leading position.

By Application: The market is segmented by application into automotive, construction, and industrial machinery. The construction segment accounted for the highest market share in 2023. The ongoing infrastructure projects under Saudi Vision 2030, such as the Neom City project, have boosted the demand for construction castings.

By Region: The market segmentation by region includes North, South, East, and West. The eastern region including Dammam and Jubail, dominated the market in 2023, primarily due to the availability of a skilled workforce and well-developed infrastructure. The presence of major players like Hadeed and Zamil Steel in this region has further strengthened its market position.

KSA Iron & Steel Casting Market Competitive Landscape

Company

Establishment Year

Headquarters

Saudi Iron and Steel Company (Hadeed)

1979

Jubail

Rajhi Steel

1984

Riyadh

Zamil Steel

1977

Dammam

Al-Tuwairqi Group

1977

Dammam

Arabian International Company

1994

Jeddah

Rajhi Steel: Rajhi Steel launched a new production line for ductile iron castings in 2023 with an investment of SAR 187.5 million. This new line is expected to increase the company's production capacity by 150,000 tons, catering to the rising demand in the automotive and construction sectors.

Zamil Steel: In 2024, Zamil Steel introduced a high-strength steel casting technology, reducing production costs by SAR 80 per ton and increasing its product durability. This innovation is set to enhance the company's competitiveness and meet the evolving market requirements.

KSA Iron & Steel Casting Market Analysis

KSA Iron & Steel Casting Market Growth Drivers:

Automotive Industry Expansion: Saudi Arabia's automotive sector experienced growth in 2024, with the total number of cars imported in 2022 and 2023 reaching 160,000 units. The country imported 93,300 cars in 2023, a substantial increase from the previous year's 66,900. This expansion has driven the demand for high-performance iron and steel castings used in engines, transmissions, and suspension systems.

Industrial Growth and Diversification: The Kingdom's industrial sector has received SAR 250 billion in investments in 2024 from both public and private sectors to diversify the economy away from oil. The development of new industrial zones and the expansion of existing manufacturing facilities have heightened the need for iron and steel castings.

Increased Oil and Gas Production: Saudi Arabia's oil and gas sector continues to be a growth driver, with production levels reaching 8.2 million barrels per day in 2024. The demand for durable and high-strength castings in oil extraction and processing equipment has increased correspondingly. This sector's consistent need for reliable cast components ensures a steady market demand.

KSA Iron & Steel Casting Market Challenges:

High Raw Material Costs: In 2024, the price of iron ore reached SAR 400 per metric ton, an increase from the previous year due to global supply chain disruptions. This rise in raw material costs has put pressure on profit margins for casting manufacturers. The fluctuating prices of essential materials like scrap iron and alloys also pose a challenge to maintaining cost-effective production.

Technological Adaptation: Adapting to new technologies in casting processes poses a challenge, as it requires substantial investment in research and development. In 2024, companies like Zamil Steel invested SAR 800 million in technological upgrades. This expenditure aims to enhance production efficiency and product quality, but the slow pace of technological adaptation can hinder productivity and competitiveness in the global market.

KSA Iron & Steel Casting Market Government Initiatives:

National Industrial Development and Logistics Program (NIDLP): It was launched in 2019, NIDLP has allocated SAR 1.3 trillion to develop the industrial sector, including iron and steel casting. This initiative aims to reduce import dependence and boost local production by providing incentives and support to manufacturers.

Investment in Industrial Zones: The 2024 budget includes SAR 2 billion for developing new industrial zones across KSA. These zones are designed to provide state-of-the-art facilities and infrastructure to support manufacturing activities, including casting operations. This initiative is expected to attract investments and enhance production efficiency.

KSA Iron & Steel Casting Future Market Outlook

KSA's iron & steel casting market is expected to grow in the coming years. The market is also likely to shift towards more organized with established players and online platforms expanding their reach.

KSA Iron & Steel Casting Future Market Trends:

Rise of Infrastructure Developments: Over the next five years, infrastructure projects under Saudi Vision 2030 will continue to drive the demand for iron and steel castings. The construction of smart cities, transportation networks, and industrial zones will require substantial quantities of high-quality cast components, sustaining market growth.

Expansion of the Automotive Sector: The KSA automotive industry is projected to increase the production of vehicles annually by 2028. This growth will increase the demand for precision castings in engine and body components, driving advancements in casting technologies and materials.
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