USD 564 Million, Flat Glass Industry investments in GCC

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The report on Flat Glass Industry in GCC also stated that GCC member states are considered as the future growth areas for flat glass due to their recent substantial growth in the construction sector that is fuelled by high oil prices and high population growth. The subject report estimated the total investment in the construction sector in the GCC countries to be more than USD 80 billion over the next five years.

The report added that, there are over 75 producers in glass sector in GCC member states, most of them are centralized in Saudi Arabia, with a capacity of 131,000 tons per year. The capacity of major glass processing industrial units is around 1.1 million tons per year.

The report indicated that the average global annual growth in flat glass consumption has been 4% in comparison to GDP growth of 2.8% for the period 1990-2003. It is anticipated that the same growth rate will be maintained over the next decade. The report also expects that the annual consumption of flat glass in GCC member states will exceed one million ton due to the recent phenomenal growth in the construction sector especially in UAE, Qatar and Saudi Arabia

Growth rate in glass products in the last three years in GCC was about 8% and expected to increase to 10-12% in the coming three years. The prices of imported flat glass range between USD 450 - USD 600 per ton or USD 6-8 per m2.

It is worth mentioning that the GCC flat glass industry is composed of small group of glass producers and a much larger group of fabricators. The former operate integrated facilities that produce both basic float glass and a wide variety of advanced products; the latter purchase basic float glass and concentrate entirely on higher value-added products.

At the international level, the four largest international glass companies produce about 45% of all flat glass. The world production grew on average 4% per annum in the period 1990-2003. China, Europe and North America absorb approximately 75% of all flat glass produced. China has increased significantly its demand since the 1990's due to the high growth in its construction sector. China now has 120 float lines as compared to only 50 float lines in Europe and is planning to add more float lines in the near future. Most of the production of flat glass in China is consumed locally with only 10% sold abroad.

The global consumption of flat glass in 2005 is estimated to be about 40 million tons, with the construction sector accounting for approximately 75%. Flat glass is widely used in the construction industry since it is available in a variety of forms and types. It is used in almost every major building in the world.

Finally, the glass industry is capital intensive and needs advanced technology and know-how. The main inputs for glass manufacturing are sand, soda ash and limestone, which are available in some of the GCC states.