PROJECTS: High-grade pellet supply to tighten as decarbonisation accelerates, says EMSTEEL executive

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First published: 21-Nov-2025 16:42:02Anoop MenonAs global steelmakers accelerate their shift toward lower-carbon production, pressure is expected to intensify on the availability of high-grade iron ore pellets, a senior executive of UAE-based EMSTEEL said.Chief Commercial Officer Michael Rion told Zawya Projects that despite softer global growth forecasts for 2026, he does not expect pellet premiums to fall.“We don’t foresee any specific surge in the premium over the next two to three years,” he said on the side lines of Fastmarkets’ Middle East Iron & Steel 2025 event in Dubai. “Once decarbonisation kicks in - especially in Europe - and the switch from blast furnace to EAF and DRI accelerates, demand for iron oxide pellets will rise - that is where we see some tension in the market.”On the other hand, steelmakers without upstream mining assets remain exposed to price-setting by major global miners.“Not having access to mining, not securing upstream could potentially be a risk for the steel producer,” he said.UAE rebar boomA surge in UAE rebar demand - forecast to grow more than 40 percent this year, one of the fastest globally - has ensured Emirates Steel is operating at full capacity.“Pre-COVID we were at 2.5 million tonnes; now we are at 5.5 million tonnes,” he said. “The market has more than doubled while our capacity has not, so competitors are pushing more material into the country; but remain well-balanced.”While rebar will continue to play a big role in the coming years due to demand from infrastructure, housing and industrial projects, Rion stressed that Emirates Steel is not overly reliant on the product.“Our priority is to move away from commoditised products and into high-value-added steel,” he said, adding that EMSTEEL’s Asset Enhancement Programme, launched in February 2025, is a step in that direction.Asset Enhancement ProgrammeThe company’s two-phase Asset Enhancement Programme, valued at around AED 625 million ($170 million), aims to upgrade rolling mills and expand capacity for advanced steel grades.Phase 1 includes:Upgrading existing rolling mills for the production of high strength rebars for sustainable constructionProducing quenched and self-tempered (QST) and thermo-mechanically controlled processed (TMCP) heavy-section steel for applications across high-rise buildings, large-scale infrastructure projects, and energy projects.Phase ...

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