Ducab Aluminium Company (DAC), an Abu Dhabi-based aluminium rod producer, plans to export most of its output as it takes advantage from the shift from copper to aluminium in industrial usage, an official said.
DAC, a Dh220 million joint venture between Dubai-based copper and aluminium wire and cable producer Ducab and Abu Dhabi industrial conglomerate Senaat, was inaugurated on Wednesday in Khalifa Industrial Zone of Abu Dhabi (KIZAD). Ducab is a joint venture between sovereign wealth fund Investment Corporation of Dubai and Senaat.
Andrew Shaw, managing director of Ducab, told The National there was room for its production capacity to grow down the line because demand for aluminium is growing as the cable industry replaces copper with aluminium due the fact that it is more affordable. The shift to aluminium in the GCC has lagged behind that in Europe and will boost demand.
"The cable market is still dominated by copper but aluminium usage has increased in the GCC," Mr Shaw said. "In Europe and the US that shift has already happened."
The executive said DAC had already signed rod supply contracts with customers across the GCC, India, Lebanon, North America and Africa and that it was also planning to export to Latin America and Europe.
The UAE is developing its downstream industry to help diversify revenue away from hydrocarbons. EGA, one of the world's largest aluminium producers, is contributing to the diversification efforts by providing raw materials for downstream industries like DAC.
DAC has a capacity to manufacture 50,000 tonnes of high quality electrical grade aluminium rod and overhead conductors a year and is targeting export sales of over Dh300m in 2018. DAC will source its molten aluminium from EGA, the largest producer of the metal in the UAE.
"The launch of Ducab Aluminium Company extends the UAE's industrial capabilities and addresses the growing aluminium market globally," said Jamal Al Dhaheri, chairman of Ducab and chief executive officer of Senaat.
"DAC has signed a long-term partnership with its neighbour EGA for the supply of molten aluminium to the facility along KIZAD's 'Hot Metal Road'. With this special partnership with EGA, we are now positioned to offer tailored products for the electrical supply chain, optimising local resources in line with the Abu Dhabi Economic Vision 2030."
Demand for aluminium is growing globally due to its increasing use in the manufacture of cars, aircraft and in the construction industry.
"Ducab Aluminium Company marks an important milestone in the UAE aluminium sector and adds to a growing number of downstream ventures in aluminium being developed in Kizad as part of the UAE's ambitions to further diversify the national economy," said Ahmad Al Shaikh, vice chairman of Ducab and DAC board member.