An investment alliance between Egypt and Qatar is considering the establishment of a steel plant in Qena Governorate, with initial outlay expected to reach $100 million, according to reports. However, market conditions are not favourable to support new capacity, local sources tell Kallanish.
The joint venture is currently in development and plans to submit in the first half of 2025 a request for a manufacturing licence to produce rebar to Egypt’s Industrial Development Authority (IDA), Egyptian economic newspaper Al Borsa News reports, citing unnamed sources.
The alliance intends to collaborate with Italian technology supplier Danieli to acquire production lines and start operations in early 2026. The Egyptian investor will provide the land and oversee construction in exchange for a 51% ownership stake in the joint project. The Qatari partner will finance the purchase of production lines and raw materials, holding a non-controlling 49% share, according to the report.
The planned joint venture will focus primarily on exporting its production, with approximately 80% of output targeted at markets in Arab countries, the Gulf region, Africa, and Türkiye. The remaining portion will be sold in the local market.
"The local [Egyptian] market is completely stagnant and foreign currency liquidity in the country is limited. Egypt has more than enough rebar production to exceed local demand. At current production costs and access to raw materials such as scrap or DRI, despite being export-oriented, new rebar investments are questionable,” a trader says.
Source:Kallanish