Qatar Steel and Bahrain Steel have inked a landmark $1.27 billion agreement. The deal, announced by Qatar’s Ministry of Commerce and Industry on February 9, will see Bahrain Steel supply 5 million tonnes of steel to Qatar Steel over a five-year period.

This strategic partnership falls under the umbrella of the Industrial Partnership for Sustainable Economic Development, an initiative designed to foster collaboration between private sector entities across member states. The program aims to stimulate growth across a diverse range of industries like agriculture, food production, fertilizers, pharmaceuticals, textiles, chemicals, plastics, manufacturing, and minerals. The steel agreement is a concrete example of this initiative in action.

The agreement is poised to significantly benefit both Qatar and Bahrain. For Qatar Steel, the deal guarantees a stable and reliable supply of essential raw materials, which will enhance production efficiency and contribute to sustainable economic growth. This secure supply chain will enable Qatar Steel to optimize its operations and better meet the growing demand for steel in the region.

Bahrain Steel, a key player in the Gulf’s steel industry, operates a state-of-the-art iron ore pelletizing facility. With a combined capacity of 12 million tonnes of pellets, the company represents a substantial $3.5 billion investment. Its strategic location and dedicated port terminal facilitate the sourcing of raw materials and the export of finished products. The company produces a variety of pellets for both direct reduction and blast furnace steelmaking, with approximately 75% of its output destined for export markets. The agreement with Qatar Steel provides a significant boost to Bahrain Steel, ensuring a substantial and consistent demand for its products.

From a broader perspective, the partnership is expected to generate new investment opportunities, boost industrial competitiveness in both Qatar and Bahrain, and fortify local supply chains. By reducing dependence on imported raw materials, the two nations aim to enhance their economic resilience and contribute to greater market stability across the region. This self-reliance is particularly important in a dynamic global economic landscape.

Qatar Steel, established in 1974 as the Arabian Gulf’s first integrated steel plant, has a long history in the region. Commencing commercial production in 1978, it has since grown into a major player in the steel industry. Since 2003, it has been a wholly owned subsidiary of Industries Qatar. Headquartered in Messaieed Industrial City, south of Doha, Qatar Steel also maintains a subsidiary in the UAE, Qatar Steel Company FZE, further demonstrating its regional reach and influence.