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SEAISI: New capacity investments will increase iron ore demand in ASEAN

Tuesday, 26 July 2022 13:46:34 (GMT+3)   |   Istanbul
       

The South East Asia Iron and Steel Institute (SEAISI) has stated that the steel production in the ASEAN-6 countries will increase to more than 90 million mt from the current 71.8 million mt with the commissioning of the ongoing capacity investment projects which are mainly focusing in Indonesia, Malaysia and Vietnam.

There will be a 30 million mt new capacity of steel production in Malaysia, around 21 million mt out of which is confirmed to commence in 2024 while the completion dates of other investment projects have not been confirmed. Major investors are WenAn Steel, Alliance Steel, Oriental Shield and Eastern Steel.

Indonesian companies Dexin Steel, Krakatau Steel/ Kakatau Posco, Fuhai Indonesia, Hebei Bishi Group and Gunung Group will carry out investment projects and additional 4 million mt of new capacity expected in 2022, 3 million mt in 2023 and 5.2 million mt in 2026, while the completion year of other investment projects of 17 million mt could not be confirmed.

In Philippines, two projects of 12 million mt will be carried out by Panhua Group and SteelAsia Group.

There will be additional 20 million mt production capacity in Vietnam within 2023. The major investors are Pomina Steel, Hoa Phat Group and Formosa Ha Tinh with a total investment of 6 million mt within 2023.

By 2026 there will be a shift from scrap base production to an iron ore base production in the ASEAN-6. In the given year, scrap-based production in the region will decrease to 36 percent from 95 percent in 2011 and the share of blast furnace technology in steel production will increase to 57 percent from five percent recorded in 2011. As a result, trade flows of iron ore will turn to ASEAN region amid higher iron ore demand. Currently, ASEAN- countries mostly source their iron ore from Brazil and Australia and the main importers are Malaysia, Vietnam and Indonesia.


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