Price and market trends: Qatar's Muntajat to open 21 offices worldwide in 2014

21 April 2014 00:00 Source:ICIS Chemical Business

Muntajat plans to open a total of 21 offices by the end of the year, aggressively growing its global reach as the sole petrochemical products distributor of Qatar, the company’s top executive said.

The expansion is in line with Qatar’s $25bn planned investment to boost its petrochemical capacity to 23m tonnes by 2020.

“Muntajat is expanding its global reach and supply chain program in preparation for the added capacity,” Abdulrahman Ali Al-Abdulla, CEO of the state-owned chemical distributor, said in an interview with ICIS. The company is currently in charge of marketing and sales of almost 90% of Qatar’s production of 15 different chemical, fertilizer and polymer products in different grades and specifications, he said.

Abdulrahman Ali Al-Abdulla

"Muntajat is expanding its global reach and supply chain program in preparation for the added capacity"

Abdulrahman Ali Al-Abdulla
CEO - Muntajat

“This figure will rise to 100% when the final transition is completed later this year,” Al-Abdulla said, citing that last year, Muntajat shipped out 7.7m tonnes of Qatari chemicals to about 80 countries.

Its global marketing arm called Muntajat BV was set up in The Hague, Netherlands in 2013 “as part of the next phase of the company’s growth”, with a target to establish about 36 offices around the world. Five offices have so far been established – in Amman, Melbourne, Cape Town, Kuala Lumpur and Istanbul.

“Muntajat is in the process of implementing our supply chain program and putting in place the infrastructure of up to 36 local marketing offices in addition to warehouses in key markets around the world to serve local and regional customers,” Al-Abdulla said, highlighting the importance of the Asian market in the industry.

Increasing its presence in Asia via opening offices in China and India – the region’s biggest emerging markets – is part of Muntajat’s next phase of expansion, he said.

“We see increase in demand across the product range, especially in fertilizers as developing markets require these products to increase and secure their food supply,” the Muntajat CEO said.

“The demand curve follows global trends in economic development, which we do not foresee changing in the near term. That’s why several of our first office openings – in Kuala Lumpur and Melbourne– are targeting high-demand Asian markets,” Al-Abdulla said.

EXPANSION

Muntajat, which was established in 2012, is proceeding with an aggressive expansion strategy notwithstanding the continued weakness of the global economy.

“While fragile, the recovery is indeed in full swing … We [Muntajat] are in growth mode. Our business strategy is based on a long-term plan that considers the cyclical nature of the global economic landscape,” Al-Abdulla said.

Muntajat is not seeing operational problems arising from Qatar’s recent diplomatic rift with other member countries of the Gulf Cooperation Council (GCC), Al-Abdulla said.

“The diplomatic differences [between Qatar and the GCC] have no material effect on the day-to-day running of the business or our ability to serve customers in the region or around the world,” Al-Abdulla said.

DIFFERENCES

In early March, political differences prompted the unexpected withdrawal of ambassadors of Bahrain, Saudi Arabia and the UAE from Qatar, raising concerns about its implications for the petrochemical industry.

According to international news reports, the political rift has to do with Qatar’s vocal support to Egypt’s ousted President Mohammed Morsi of the Muslim Brotherhood movement – which is outlawed in Bahrain, Saudi Arabia and the UAE.

In a related development, a top Dubai security official – General Dahi Khalfan – was reported on 3 April to have dubbed Qatar as “UAE’s eighth emirate” in a tweet which appeared on Twitter, sparking an outrage, according to web-based news portal Arab News. Dubai is one of the seven emirates of the UAE.

By Pearl Bantillo