PETALING JAYA: The Malaysian Iron and Steel Industry Federation (Misif) has blamed Chinese steelmaker Alliance Steel (M) Sdn Bhd for the losses incurred by the local steel industry in the last three quarters.
Misif president Datuk Lim Hong Thye claimed that Alliance Steel had been crowding out the local steel bar manufacturing segment since October last year and producing only a small amount of beam and medium section products that were supposed to be Alliance Steel’s mainstay as these are not commonly produced in Malaysia.
“We can see the results of every one (steelmakers) just gone down the hill. This is something that we’ve also discussed with Miti (Ministry of International Trade and Industry) for allowing such a big player to come in for like (similar) products. Even though they promised to produce beam and medium section, and only a small portion of bar and wire rod, it ended up that (bar and wire rod) is the majority of the products they are producing and it is causing a bad situation in Malaysia,” Lim told reporters on the sidelines at the 2019 Trade Forum on the Malaysian Iron and Steel Industry here today.
He said Malaysia’s rebar price today at slightly over RM1,900 per tonne is some RM300 below China’s domestic price of RM2,200 per tonne.
“One month ago, the price was as low as RM1,800 in Malaysia. It’s a bad situation. There’s no reason why Malaysia’s price should be so far below China’s.”
Alliance Steel is the largest steel plant in Malaysia with an annual production of 3.5 million tonnes. It is the largest investor in the Malaysia-China Kuantan Industrial Park. The steel company is owned by Guangxi Beibu Gulf Port International Group Co Ltd and Guangxi Shenglong Metallugical Co Ltd.
However, Lim, who is also Ann Joo Resources Bhd group managing director, stressed that Misif and Ann Joo are not against new investments into Malaysia.
“We’re not against new capacity, but we hope the new capacity coming in to Malaysia will bring the industry forward. Alliance Steel is not a bad project. They’re supposed to produce beam and medium section which are not produced in Malaysia, but the government needs to make sure they really produce what they said (they would).”
Meanwhile, Miti is mulling freezing the issuance of new manufacturing licences for steelmakers that want to produce like products in the market.
“This is an important decision that we’re still undertaking consultation on and we have to seek the Cabinet’s mandate. One of the major deliberations and considerations is the need to ensure the sustainability of our local industry,” Miti Deputy Minister Ong Kian Ming said.
“Any new players coming in to the country is coming in with large capacity, which will have significant and severe impact on the local steel industry. Hence we have to evaluate each application carefully,” he added.
The freezing of new manufacturing licences is one of many items in the White Paper on Iron and Steel, which Ong said Miti hopes to present to the Cabinet by year-end.
On April 30, 2019, the steel industry submitted the White Paper on Iron and Steel containing 68 recommendations under seven transformation drivers as a collaborative effort between stakeholders in the steel industry and various associations, including Misif.
“On the White Paper, Miti has developed a framework of actions where some short term measures will be instituted to ease the uncertainties faced by the industry while undertaking due diligence process in line with both the 12th Malaysia Plan and the new Industrial Masterplan under Miti,” said Ong.
source https://www.thesundaily.my/business/misif-blames-china-owned-alliance-steel-for-malaysian-industry-s-losses-CX1527411
No comments:
Post a Comment