04 November 2010
Steel Association Members to Invest RM 5Bil

The nine members of the newly-formed Malaysia Steel Association (MSA) will invest RM 5Bil in the next three years to boost their capacity by 3.2 million tonnes a year.

"This will make us one of the biggest steel manufacturers in the Asean region," its president Tan Sri William Cheng said.

MSA members had to-date invested about RM 14.5bil in the local steel industry, he said at the launching of the association yesterday.

MSA was launched by Minister in the Prime Minister's Department Tan Sri Nor Mohamed Yakcop, representing the Prime Minister. Its nine founding members are Amsteel Mills Sdn Bhd, Ann Joo Steel Bhd, Ann Joo Integrated Steel Sdn Bhd, Antara Steel Mills Sdn Bhd, Kinsteel Bhd, Malaysia Steel Works (KL) Bhd, Megasteel Sdn Bhd, Perfect Channel Sdn Bhd and Perwaja Holdings Bhd.

The MSA has urged the Government and the rakyat to support local industries in order to assist the steel and other industries to grow and achieve their full potential.

"We urge all Government tenders and projects, including those by quasi-Government bodies such as Petronas, to use local materials, services and fabricators for their oil rigs, for example," Cheng said.

He said it was most timely for local steel industry to support Government projects following the recent announcement of mega projects under Economic Transformation Programme.

Cheng said investing in upstream facilities, especially in iron making, would help the steel industry to be more self-sufficient in the supply of raw materials, and achieve greater cost efficiency and higher quality.

"Since Malaysia has iron ore and coal which are used in steel making, we request the Government to allocate more land of 3,000 to 5,000 acres containing such deposits to local steel makers who need these raw materials," he said.

Cheng said this would help reduce dependency on imported iron ore and coal and lower the outflow of foreign exchange.

"We also request the Government to impose an export duty of say, 30% or RM140 per tonne whichever is higher, on iron ore, to encourage further processing of the ore into finished products locally.

"This will create higher value add which is retained in the country, boost greater iron ore-based manufacturing activities and generate employment opportunities."

Cheng said the association was appealing to the Government to assist the local steel industry by discouraging the export of scrap with an increase in export duty on scrap from 10% to 30% or RM350 per tonne, whichever was higher.

"Malaysia now imports about three million tonnes of scrap a year as the local scrap supply is insufficient and the supply is further reduced with the continuing export of local scrap," he said.


(Source: SEAISI Website)
http://www.seaisi.org/news/news_view.asp?news_id=2155

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