NEWSLETTER - SEAISI · “Realising the Value within ASEAN Steel Industry through Technology Development, Capacity ... Masteel upgrades SBQ production with new rolling block

The 2017 SEAISI Conference & Exhibition was successfully held at Resorts World Sentosa, Singapore from 22 to 25 May 2017. With the theme “Realising the Value within ASEAN Steel Industry through Technology Development, Capacity Optimisation and Digitisation”, the event was well attended by some 500 delegates from 30 countries across the globe.

The opening ceremony was officiated by Dr. John Keung, CEO of Building and Construction Authority (BCA) Singapore, who gave an address on “Construction Productivity in Singapore – Changing the Way We Build”. He elaborated on how Singapore addressed the problem of stagnating value added productivity in its construction industry in the pre-2010 by instituting measures such as raising manpower cost to drive technology substitution, setting minimum standard through the building framework, incentivising private sector to be first movers and driving Building Information Modelling (BIM) adoption etc.

The Keynote Session that followed featured speak-ers from three top steel companies in Asia. The first speaker was Mr. Peeyush Gupta, Director, Tata Steel Limited and Vice President (Marketing & Sales), Tata Steel India. In his presentation, Mr. Gupta pointed out that since the economic crisis, value pool has shifted towards raw materials and downstream processing. In this connection, his advice to the ASEAN steel industry is to focus on operational excellence to stay competitive in conversion costs and downstream and solutions to enhance profita-bility.

The next keynote speaker was Mr. Yoichi Furuta, Managing Executive Officer, South East Asia & India, Nippon Steel & Sumitomo Metal Corporation (NSSMC). In his address, Mr. Furuta explained in detail NSSMC’s strategy for ASEAN market, its localised operations in ASEAN and its approach to ASEAN construction market which focuses on

M.N. Dastur & Company (P) Ltd. Some of the key points raised in this session include:

Improved domestic market conditions in China will reduce the incentive to export and steel that is exported will be priced higher relative to costs; The supply-side reforms / environmental measures in China have alleviated substantial pressure on Southeast Asian steel producers; Upstream capacity in ASEAN hindered by lack of natural resources; Steelmakers need to increase cost competitive-ness in downstream industry.

In line with the theme of the conference, there was a special session on “Industry 4.0 and Steel Industry” which featured speakers from Accenture Singapore, PSI Metals, SMS Group, Danieli Automation SPA and Primetals Technologies.

As usual, the presentation of Country Reports by the nine member countries of SEAISI was very well received by the delegates. In addition, a total of 72 technical papers were delivered by various experts over 14 sessions on the second and third day of the conference.

The plant tour after the conference attracted some 80 delegates who were divided into two groups, the first visiting Yongnam Holdings’ fabrication plant and The Accenture Internet of Things Centre of Excellence in Singapore, while the second group visited the manufacturing facilities of Bahru Stainless Sdn Bhd and Kiswire Sdn Bhd in Johor, Malaysia.

All in all, the 2017 SEAISI Conference & Exhibition in Singapore was a big success. The institute would like to convey its deepest appreciation to the co-host of the event, NatSteel Holdings Pte Ltd, all the speakers and chairpersons, all the exhibitors, sponsors and advertisers, all the companies that hosted the plant tour and all the delegates for your tremendous support and participation.

The 2018 SEAISI Conference & Exhibition will be held in Indonesia. The theme will be “ASEAN Steel Industry – Next Leap of Transformation”. We look forward to seeing you all again at our next year’s event.

TAN AH YONG

broadening the use of steel structure. He also touched on the corporate strategy of NSSMC which is centred on technological superiority, cost competitiveness and global supply capabilities.

Mr. Kwak Jeong-Shik, Executive Vice President and Head of External Relations, POSCO, the third keynote speaker, talked about the three core values of POSCO viz. providing solutions to enhance customer’s value, environmental respon-sibility and corporate social responsibility. Based on the core values, POSCO’s strategic approaches are enhancing overall value in steel industry through competition and collaboration, creating value through smart transformation by applying technology-enablers of Industry 4.0 and adopting code of ethics as the foundation of cultural diversi-ty.

After the keynote presentations, the three keynote speakers were joined by Dato’ Soh Thian Lai, Group Executive Deputy Chairman of YKGI Holdings Berhad and Mr. Win Viriyaprapaikit, President & Group CEO of Sahaviriya Steel Industrial Public Company Limited for a CEO Panel Discussion. The session, moderated by Mr. Ashish Anupam, Chairman of SEAISI, saw a lively exchange of views among the panel members and conference delegates on topics of current interest including solutions for a sustainable steel development in ASEAN, trend in steel manufactur-ing companies going downstream to more customised products/solutions, protective measures on imports of steel, the likely emergence of India as the second largest steel producing / consuming country in the world, the impact of the probe by USA on steel imports under section 232 and digital transformation and its impact on the steel industry.

In the session on “Regional Developments”, delegates were updated on the developments of the iron and steel industry in ASEAN as well as in the region’s two most important neighbours – China and India.

The papers presented for the session on “Market Perspectives & Challenges” were “The Future for Chinese Steel: Steel Prices and Influencing Factors” by CRU, “Developments in Steelmaking Raw Materials and the Impact of Chinese Environmen-tal Measures on South East Asian Steel Industry” by MySteel, “Regional Steel Price Trends within a Global Environment” by MEPS and “Towards a Globally Competitive Steel Industry in ASEAN – Strategies and Risk Mitigations as We Grow” by

Publisher: SEAISI Editor: Pichsini Tepa-Apirak Contributing Editor: Josephine Fong Printer: PLANAX Marketing (M) Sdn. Bhd.Email: [email protected] Tel: 603 55191102 Fax: 603 55191159 Website: www.seaisi.org

MESSAGE FROM THE SECRETARY GENERAL

May 2017

NEWSLETTERISSN 0166-9645

SOUTH EAST ASIA IRON AND STEEL INSTITUTE

SEAISI

2 SEAISI Newsletter, May 2017

ContentsMessage from Secretary General ....................................................... 1

Australia reviewing AD duties on Chinese galvanized steel ........... 2

Krakatau Steel eyes $10 million net profit ........................................ 2

Japan’s imports rise in April as domestic mills curb supply ............. 3

Japan’s crude steel output up 3% in April .......................................... 3

Posco turns to Essar for HRC for Indian operations ........................... 3

Malaysia starts AD case on stainless cold rolled steel .................... 4

SteelAsia signs supply deals with 2 Russian firms ............................ 4

Philippines removes duty on billet imports from all countries ........ 4

Singapore rebar import market at standstill as offer-bid gap

persists ............................................................................................... 5

USA imposes huge final anti-dumping margins on Taiwan plate ...... 6

Thailand’s final AD duties on HRC imports see little change ............ 6

Iranian steelmakers bolster presence in Thailand market .............. 6

Domestic steel consumption slows down in April ............................ 7

VCA to hold public consultation on anti-dumping duties .................. 7

Vietnamese steel suffers slow growth ............................................... 8

Formosa Ha Tinh to fire first blast furnace this month ..................... 8

Vietnamese output rises in Q1, but imports stay high ..................... 9

Second review of anti-dumping duties on imported steel ................ 9

Brazil’s April steel production up 26% on year .................................. 9

Steel exports surge 142%, imports down 23% in April ...................... 9

India slaps anti-dumping duties on Korean steel for 5 yrs ........... 10

India on right path to becoming global steel player: Steel

Association ....................................................................................... 10

China to cut steel capacity but excess output still expected

– Eurofer ............................................................................................ 11

Chinese economy ‘buoyed by steel, infrastructure’ ....................... 11

Masteel upgrades SBQ production with new rolling block .............. 12

Iran Steel Exports Up 83% ................................................................. 12

US to impose anti-dumping, countervailing duties on CTL plates .. 13

Southeast Asian steel billet buyers start to accept costlier

non-Chinese material ....................................................................... 13

SEAISI CONF: How Southeast Asia’s steel industries view China .... 14

Too soon to weigh impact of Section 232 on US producers ............. 14

Construction productivity in Singapore – changing the way

they build .......................................................................................... 15

2017 ASEAN Iron and Steel Sustainability Forum: Call for papers .... 16

A U S T R A L I A

I N D O N E S I A

Australia reviewing AD duties on Chinese galvanized steel

The Australian Anti-Dumping Commission has initiated a reviewof anti-dumping duties affecting Chinese exporters of certaingalvanized flat steel products.

The case was opened following a request from China’s ShandongGuanzhou Dingxin Plate Technology made last month, thecommission said in a notice on Tuesday May 16.

Currently, Australia has anti-dumping duties in place for bothalloy and non-alloy galvanized flat steel imports from Chinaand Taiwan.

The same measures, which were first imposed in August 2013,have become the subject of reviews pursued by other exporters,such as China’s Yieh Phui Technomaterials and Taiwan’s ChungHung Steel.

After concluding the review, the commission will make arecommendation to the parliamentary secretary to Australia’sminister for industry, innovation and science as to whether theanti-dumping duties should remain unchanged or be changed.

The recommendation will be made by July 26.

“If recommending to the parliamentary secretary that differentvariable factors be applied to the applicant, I may propose achange in the method to determine the interim dumping duty andthe interim countervailing duty payable,” commissioner DaleSeymour said.

Metal Bulletin, May 18, 2017

Krakatau Steel eyes $10 million net profit

State-owned and publicly listed Krakatau Steel (KRAS) aims tobook US$10 million in net profit this year after losing $171.69million amid low steel prices last year.

Steel prices could still go lower than they are today, said thefirm’s president director, Mas Wigrantoro Roes Setyadi, but heexpressed his optimism about achieving the company’s targetthrough cost efficiency measures and more aggressive marketing.

“We have a cost efficiency program targeting 15 percent lower(operational) costs than last year,” he told The Jakarta Post afterthe 2017 Indonesia Steel Conference “The Road to Cilegon 10 MTSteel Cluster” in Jakarta on Tuesday.

“We’ll make the management of maintenance and procurementmore efficient and reduce idle manpower,” he added.

The firm reiterated its mission to also provide products it cannotproduce itself by sourcing them from third parties in a bid toincrease sales.

SEAISI Newsletter, May 2017 3

In the first quarter, the firm’s loss fell by 65.3 percent to $20.7million, while its revenue increased by 12.5 percent to $350.1million.

The Jakarta Post, May 24, 2017

Japan’s imports rise in April as domestic mills curb supply

Japan’s steel imports in April increased by 12.4% year-on-yearbut dipped 1.7% from March to 682,797 metric tons to make forthe second consecutive y-o-y monthly increase, according topreliminary data from Japan’s Ministry of Finance.

Ministry officials in charge of trade data were unavailable forcomment Tuesday, but a Tokyo-based trader said the increasemust have resulted from the supply restraints being observed bythe domestic steelmakers. “The Japanese mills have beenproducing strongly but supplies for spot sales have been limited,”he said. “There have also been some delays to deliveries so somecustomers in Japan have been relying on the imports.”

Within the April import total, those from Asia at 539,195 mtwere up 3.9% y-o-y but down 6.9% from March.

Though product-by-country data isn’t yet available, anothertrader in western Japan said the largest suppliers to the Japanesemarket in Asia are the South Korean mills and the largest increasein imports in March was for plates.

“We expect this to continue for a while until the Oita plate millrestarts,” he said. Nippon Steel & Sumitomo Metal’s 2.8 millionmt/y capacity plate mill in Oita in western Japan has been haltedsince January after a fire, as reported. NSSMC plans to restartthe mill from early August.

Imports of plate in March reached 74,159 mt of which SouthKorea supplied 92% or 68,546 mt, up 50% y-o-y and 41.2% m-o-m, according to the Japan Iron & Steel Federation (JISF).

The western Japan-based trader noted that imports from Chinahave been decreasing, with those in April down for the eighthstraight month. “It must be because China’s domestic demandhas been firm and Chinese mills are not eager to export,” he said,adding that China-origin imports would remain thin for a while.Steel imports from China in April reached 102,484 mt, down22.6% y-o-y, according to the data.

Detailed trade data by product for April will be released by theJISF on May 30.

Platts, May 24, 2017

Japan’s crude steel output up 3% in April

Japanese crude steel output rose 3% year-on-year in April, withboth electric arc furnace (EAF) mills and basic oxygen furnace(BOF) operators registering higher production.

Mills in Japan produced a total of 8.75 million tonnes of crudesteel last month, the Japan Iron & Steel Federation (JISF) said onTuesday May 23.

J A P A N

Of this total, BOF steelmakers produced 6.62 million tonnes, up0.6% on the year, while EAF mills produced 2.12 million tonnes,an 11.3% increase.

Finished steel output inched up by 2% to 7.58 million tonnes, ofwhich carbon steel products accounted for 5.91 million tonnes –a drop of 0.6% from a year earlier.


Posco turns to Essar for HRC for Indian operations

Restricted by India’s import protection measures, PoscoMaharashtra, a wholly-owned subsidiary of South Korea’s Posco,has turned to sourcing Indian steel to feed its downstream coldrolling and coating operations.

Posco Maharashtra, based in the western state of Maharashtra,signed a contract with Essar Steel in early May for the supply of1.1 million mt of HRC for the financial year started April, anEssar official told Platts.

“Posco Maharashtra has no option but to buy domestic material,”said a Mumbai-based trader with a South Korean tradingcompany, explaining Posco is restrained by India’s HRC importrestrictions.

The mill had been sourcing HRC from its South Korean parentand from Posco’s Indonesian joint-venture PT Krakatau Steel(PTKP), but this was halted after the Indian government launchedthe minimum import price scheme in February last year. Thisstipulated minimum landed prices on steel imports includingHRC, below which imports were not allowed. Essar Steel buysslabs from PTKP as raw material for its rolling mills, the Mumbaitrader told Platts.

Imports were further restricted since New Delhi replaced theMIP with an antidumping duty imposed on May 11 on HR importsfrom six countries including South Korea. India’s finance ministrydeclared that such HRC imports priced below $478-489/mt willbe levied the difference between the CFR price of the shipmentand the minimum price specified.

South Korea’s overall HR exports to India plunged by 35% onyear to 837,150 mt during the year ended March, according tolatest data published by India’s Joint Plant Committee.

Posco Maharashtra operates a 1.8 million mt/year cold rollingmill and a 450,000 mt/year galvanizing line at its Vile Bhagadplant in Maharashtra.

Essar Steel and Posco Maharashtra had initiated talks on theirfirst supply deal even before the MIP was introduced, said RanjanDhar, chief marketing officer (flat steel) at Essar Steel. The initialcontract was for 800,000 mt of HRC. “Such contracts help us tolock-in production and sales volumes,” Dhar insisted.

“We have a 10 million mt/year rolling capacity, but were unableto fully utilize our gas-based steel melting capacities due to high

price of gas and lack of funds,” another Essar spokesperson said.

K O R E A



Malaysia starts AD case on stainless cold rolled steel

The Malaysian government has initiated an anti-dumpinginvestigation on imports of stainless cold rolled steel from China,South Korea, Taiwan and Thailand.

The case was opened following a petition from domestic stainlesssteel producer Bahru Stainless, who alleged that imports fromthe four territories had been “dumped into Malaysia at pricesmuch lower than their domestic price”, Malaysia’s Ministry OfInternational Trade & Industry said on Monday May 15, the sameday the probe commenced.

“The petitioner further claimed that imports from the allegedmarkets have increased in terms of absolute quantity and thatthe petitioner suffered material injury,” the ministry said.

A preliminary determination will be made within 120 days fromthe date of initiation of the case.

Products under investigation comprise stainless cold rolled steelin coil, sheet or “any other form”, with thicknesses of up to 6.5mmand widths not exceeding 1,600mm.

They are classified under HS codes 7219.31000, 7219.32000,7219.33000, 7219.34000, 7219.35000, 7220.20130, 7220.20190and 7220.20900.


SteelAsia signs supply deals with 2 Russian firms

SteelAsia Manufacturing Corp., the Philippines’ leading steelcompany and the largest manufacturer of steel bars (rebar) inSoutheast Asia, has closed deals with two of Russia’s leadingcompanies for a steady supply of billets and technology andskills transfer.

SteelAsia and Evrazhave signed a $250-million, long-term annualsupply of 50,000 tons of semi-finished steel, also known asbillets, for SteelAsia’s rolling mills in Davao City andMeycauayan, Bulacan.

Billets are the input material for many long steel products,including rebars.

M A L A Y S I A

P H I L I P P I N E S

SteelAsia has also worked out a cooperation arrangement withKurganstalmost JSC for the provision of engineering services aswell as training and technology transfer to SteelAsia.Kurganstalmost is Russia’s leading producer of steel structures.

“We have found that Russian companies are very reliablebusiness partners,” said company Chairman and CEO BenjaminYao.

He said the long term billet supply contract assured the companyof a stable source of raw material, insulating the country fromrebar shortage, while the technology and skills transfer were inpreparation for SteelAsia’s diversification into steel structures.

“Our expansion plans are all geared towards supporting thecountry’s focus on massive infrastructure build up,” Yao said.

SteelAsia since 1998 has bought about 3.24 million tons of billetsworth $1.23 billion from Russia.

The company in the first quarter of 2017 purchased 240,000tons of billets worth $93 million.

SteelAsia also transacts with several Russian steel companies,including NLMK and Evraz—Russia’s two largest steel makers,EMK/Ural Steel/Metalloinvest, JSC Amurmetal, Amurstaal, KMKand Mechel.

Evraz has operations in Russia, Ukraine, United States, Canada,Czech Republic, Italy, Kazakhstan and South Africa. Its crude steeloutput last year topped 13.5 million tons.

Kurganstalmost, part of the Russian industrial and infrastructuregiant Mostostroyindustria of Transstroy Corp., has a cutting-edge technology and engineering service, an experience in steelstructure production, a training center, and Russian Eximfinancing at competitive rates and terms.

SteelAsia has an annual capacity of 2.3 million metric tons, withsix plants strategically located across the country. It is expandingits rebar capacity to 4 million metric tons in the next five toseven years.

Manila Standard, May 29, 2017

Philippines removes duty on billet imports from all countries

The Philippines is eliminating a most-favoured-nations (MFN)tariff of 3% on imported billet from June 17 onwards.

The decision will provide “a more playing field” for major billetsuppliers from countries such as Russia, Ukraine and Turkey,which were at a disadvantage against Chinese sellers, marketparticipants in the Philippines told Metal Bulletin.

At the moment, there is a 3% import duty on billet from mostcountries. Only products from the Assn of Southeast Asian Nations(Asean) region and several nations with which Asean has freetrade agreements – such as China and South Korea – are exemptfrom the duty.

Billet from India is subject to a 1% tax because of a free tradeagreement between the country and Asean.


A specific agreement between the Philippines and Japan – calledthe Philippines-Japan Economic Partnership Agreement (PJEPA)– as well as the regional Asean-Japan Common EffectivePartnership Agreement (AJCEPA) guarantee 0% tax on imports ofJapanese billet, though only certain specifications of the productqualify.

“Now billet from all countries will have zero [duty],” RobertoCola, president of the Philippine Iron & Steel Institute (Pisi), toldMetal Bulletin on Monday May 29.

Executive orderThe decision to reduce the tariff on imported billet to zero is theresult of an executive order signed by Philippine PresidentRodrigo Duterte on April 27, though it was only published in themiddle of May.

The changes are meant to “promote transparency and stability,facilitate trade and enhance consumer welfare”, according tothe official text.

The new tariff regime will apply from 2017 until 2020, replacingthe previous MFN tariff schedule that originally ran from 2011to 2015.

“The 2015 tariff rates continued to be applied in 2016,” theexecutive order read.

Chinese dominancePhilippine billet importers had been lobbying for the eliminationof the tariffs for the past several years.

In the beginning of 2014, three of the country’s biggest billetimporters – Steel Asia Manufacturing Corp, Lunar Steel Corp andPag-Asa Steel Works – filed a petition to seek its removal.

The proposal was endorsed in that same year by the PhilippineTariff Commission, but was not immediately put into effect bythe country.

Billet importers in the Philippines were lobbying for the removalof the tariff to reduce their reliance on Chinese billet, which hadbecome dominant in the country for the past few years, marketparticipants said.

“We now have interesting times ahead of us,” one trader in Manilasaid.

“A lot of buyers are just tired of doing business with China,” hesaid, referring to several cases of shipment delays or contractdefaults involving Chinese billet.

Last year, the Philippines imported 3.14 million tonnes of billet,up 9% from 2015, according to Pisi figures.

Sources estimate that over 90% of these came from China.Metal Bulletin, May 29, 2017

S I N G A P O R E

Singapore rebar import market at standstill as offer-bid gappersists

Rebar importers in Singapore remained on the sidelines thisweek due to the persistent gap between offer prices and bids,poor local demand and high inventories for some major buyers.

Metal Bulletin’s price assessment for rebar imports intoSoutheast Asia – which mainly looks at Chinese cargoes soldinto Singapore on a theoretical weight basis – was $400-410 pertonne cfr for the week ending Monday May 22, up by $5-10 pertonne from the preceding week.

Even though no transactions were heard in the market, there wasnews that one or more customers in need of cargoes might beprepared to accept about $420-430 per tonne cfr for July-shipmentcargoes from China, sources told Metal Bulletin.

“I heard some customers are willing to pay $430 [per tonne cfr],”one Singapore-based trader said on Thursday May 25.

Such a price would be much higher than bids and priceindications at the end of last week of no more than $410 pertonne cfr, and a major stumbling block is that there are no traderswilling to take the risk and sell at that price.

“There’s no supply at this level at all,” a second trader said onThursday.

“I can’t even get this price on an fob [China basis],” he said,referring to $420 per tonne.

Chinese mills have been offering cargoes at prices of at least$470 per tonne cfr, several of the sources told Metal Bulletin.

A few traders were offering material at $450-460 per tonne cfr,up from as low as $430 per tonne cfr last week.

“Traders are not offering much because the price gap [betweenoffers and bids] is too big,” a trader said.

“Some buyers do want to buy July shipment [cargoes], but theycan’t accept the high prices [being offered at the moment],” headded.

He pointed out that It would be “quite risky” for traders to ventureinto short selling deals at low prices now, as there is no certaintywhether domestic prices from China will come down significantlyin the coming weeks.

And there is no cheap alternative supply from non-Chinese originsright now, with offers from Turkey and other countries at veryhigh prices too, another trader told Metal Bulletin.

A source at a rebar importer admitted that the local market hasbeen “very bad” lately, with stockists and cut-and-bend companiescurrently “bleeding”.

Construction projects in the private sector in Singapore havebeen very slow, with rebar sellers engaged in “too muchcompetition” to win projects in the public sector, one of the traderssaid.


“Local prices actually moved down to SG$550-560 ($396-403)per tonne, so local prices and import prices are moving in oppositedirections,” the rebar importer source said.

Another market participant said several cargoes of Turkish rebarhad recently arrived in Singapore.

“A lot of Turkish rebar is arriving here, at an average price of$430 [per tonne cfr], while local prices are around $400 [pertonne cfr],” he said.


USA imposes huge final anti-dumping margins on Taiwan plate

The US government’s Department of Commerce has imposedmassive amended final anti-dumping duties on imports of cut-to-length plate from Taiwan.

Commerce slammed Taiwan’s China Steel Corp (CSC) withamended final duties of 75.42%, up from a final rate of only6.95%, according to a May 25 notice in the USA’s Federal Register.

The adjustment to CSC’s margins resulted in the rate for “allother” Taiwanese plate suppliers jumping to 39.52% at theamended final stage of the case, compared with 5.29% whenfinal duties were rolled out in March.

Only Taiwanese producer Shang Chen Steel, with duty at 3.62%,maintained its final rate.

The change marks the second time that Taiwanese steel productshave seen final margins amended upward by a substantial figure.

Taiwan last year saw duties on its exports of coated flat-rolledsteel to the USA climb to an amended final rate 10.34%, from afinal rate of 3.77%. That jump came after coated material fromTaiwan received no duties at the preliminary phase of the case.

The big change to Taiwan’s plate margins resulted frommathematical and clerical mistakes, Commerce said. Thedepartment refers to such events as “ministerial error”.

Ministerial error also resulted in amended final rates forGermany’s Dillinger Group increasing to 5.52% from a final rateof 5.38% and in rates for “all others” increasing to 21.04% froma final rate of 21.013%.

Margins for German steelmaker Salzgitter were unchanged at22.9%. However, Salzgitter and the German government haveaccused the Commerce Department of violating internationaltrade laws with the high margins.

Clerical slips did not result in all margins being increased.

South Korea saw amended final anti-dumping margins for itsplate, including material from Posco, drop to 7.1% from 7.39% atthe final phase of the case.

France likewise saw margins for Dillinger France and “all other”producers dip to an amended final rate of 6.15%, compared with

T A I W A N

T H A I L A N D

a final rate of 8.62%. But a hefty margin of 148.02% remained inplace on plate from Industeel France.

Taiwan, Germany, South Korea and France were among 12 nationstargeted in a trade case filed a year ago against imports of cut-to-length plate. Commerce has also assessed Austria, Belgium,Brazil, China, Italy, Japan, South Africa and Turkey with anti-dumping margins.


Thailand’s final AD duties on HRC imports see little change

Thailand has set definitive anti-dumping duties on imports ofhot rolled flat steel products in coil and sheet form from Brazil,Iran and Turkey.

The definitive duties contain minor changes when compared withthe preliminary rates.

They range from as low as 6.88% to as high as 38.23%, and are inplace for a period of five years from May 16, according to anotice published in the Royal Thai Gazette earlier this month.

They compare with preliminary duties of 7.09-38.52%, whichhad been imposed on November 16 for an initial four monthsbefore being extended for two months until May 15.

The lowest duty of 6.88% was set for imports from Turkey’sÇolakoglu Metalurji, lower than the provisional rate of 7.09%.

Imports from Turkey’s Erdemir and Isdemir will be subjected to aduty of 27.27%, down from 28.34%, while other Turkish supplierssaw their duty lowered to 38.23%, from 38.52%.

Products from Iran’s Mobarakeh Steel will be levied a 7.25% tax,down from 7.37%, while the duty for other Iranian mills has beenreduced to 38.27%, from 38.52%.

The duty for imports from Brazil was unchanged, at 34.4%.

The investigation, which was opened in January 2016, drew strongcriticism from Turkish market participants early this year.


Iranian steelmakers bolster presence in Thailand market

Thailand is currently the world’s fourth largest importer of steeland Iran is gradually becoming a major exporter to the SoutheastAsian market.

The kingdom imported a total of 13.2 million tons of semi-finished steel and steel products last year, up 15% compared tothe year before, Foolad News reported.

Major infrastructure, transportation and construction projectsunderway in Thailand have required a steady feedstock of steelover the years. Consequently, Thailand’s import growth trendhas followed a steady uptrend ever since 2000, with only a slighthiccup in 2007-9.


In 2016, the country’s steel imports amounted to 4% of the totalglobal shipments.

Iran exported 5.53 million tons of semis and steel products inthe last Iranian year (March 2016-17), the Iranian Mines andMining Industries Development and Renovation Organizationreported.

Over 16% of the total figure, amounting to 884,800 tons, wereshipped to Thailand. This indicates an over 97% growth inshipments year-on-year and makes Iran the fourth fastest growingexporter of the commodity to the kingdom, followed by Indonesia,Australia and China.

Thailand imports steel from 110 countries with the minimumvolume being about 400,000 tons from each. The large numberof willing trade partners has enabled Thais to be ratherautonomous in choosing one and the rise in shipments fromIran can be a positive sign of consumers favoring Iranian steelover others.

And expanding steel export markets is just what the Iranianindustry needs. It is currently following an aggressive capacityexpansion program as it aims to reach an annual productioncapacity of 55 million tons of steel by the end of 2025, as part ofthe so-called 20-Year Vision Plan (2005-25).

According to Minister of Industries, Mining and TradeMohammad Reza Nemtazadeh, the industry has realized about60% of the target capacity so far.

Experts believe that in order to sustain capacity growth,steelmakers must boost exports as the local construction marketis still low on demand and shows no immediate signs of recovery.

However, gaining new grounds in any market on a rapid pacewill spook the market’s local producers and cause them to takeaction against what they might deem as dumping strategies.Thailand set definitive anti-dumping duties on the import of hot-rolled flat steel products in coil and sheet forms from Iran onThursday. They range from 6.88% to 38.23% for five years startingMay 16 and will affect Brazil and Turkey as well, according to anotice published in the Royal Thai Gazette.

Thai officials’ main focus for anti-dumping duties was productsfrom Iran’s Mobarakeh Steel Company, which will be levied a7.25% tax. The duty for other Iranian mills stands at 38.27%.They compare with preliminary duties of 7.09-38.52%, whichhad been imposed on November 16 for an initial four monthsbefore being extended for two months until May 15.

The main product under scrutiny was carbon steel hot-rolledcoils and sheets, with a thickness of 0.9 mm to 100 mm and awidth of 100 mm to 3,200 mm. This is not the first time Iraniansteelmakers, especially MSC, face steel dumping charges. Backin early 2016, the Brussels-based steel lobby group Eurofer,declared that Iranian steel exports had become a “threat” toEuropean markets.

The group’s members, who produce more than a quarter of EU’siron and steel products, were startled by data showing IranianHRC shipments growing nearly eightfold between 2013 and 2016to over 1 million tons.

The European Commission was expected to set preliminary anti-dumping duties on Iranian HRC back on April 7, but backtrackedon its decision a few days later. EC announced that it might stillimpose definite duties within the next six months, Metal Bulletinreported.Iranian steelmakers exported over 3.74 million tons of semisand 1.79 million tons of steel products in the fiscal 2016-17,registering a 108% and 16% growth respectively compared to thepreceding year, according to Iranian Steel Producers Association.

Thailand, the UAE and Taiwan were the main customers of Iraniansteel, accounting for 16%, 12% and 11% of the total exportsrespectively, statistics released by IMIDRO show.

Italy with 9%, Oman with 7%, China with 7%, Iraq with 6%,Afghanistan with 5%, Jordan with 3%, Turkey with 3%, Egypt with3%, Brazil with 3%, Spain with 2%, Morocco with 2% andTurkmenistan with 2% followed.

Financial Tribune, May 30, 2017

Domestic steel consumption slows down in April

Domestic steel consumption recorded a modest year-on-year riseof 2.7 per cent in April to some five million tonnes, according tothe Viet Nam Steel Association (VSA).

Last month, the purchase of construction steel products dropped14 per cent year-on-year to reach more than 635,000 tonnes. Asof April 30, the inventory volume of construction steel stood at720,000 tonnes, much higher than the previous month.

Consumption of steel pipes also saw a slight decrease of 5 percent to some 158,000 tonnes, the association said.

According to VSA, 6.23 million tonnes of steel, worth US$3.18billion, were shipped to Viet Nam until April 15, marking a yearlyslump of 5 per cent in volume but an increase of 22 per cent invalue.

The association attributed the drop in the quantity of importedsteel to the positive impact of Viet Nam’s safeguard measures,which have resulted in local enterprises having to face lesspressure from competition.

Earlier, the association predicted the local steel industry wouldlikely enjoy 10-12 per cent growth this year.

With expected GDP growth of 6.2 per cent this year and theoperation of 10 steel projects in 2017, the sector’s growth isexpected to expand further, it said.

Viet Nam News, May 11, 2017

VCA to hold public consultation on anti-dumping duties

Viet Nam Competition Authority (VCA), under the Ministry ofIndustry and Trade, has invited concerned parties to a publicconsultation on anti-dumping tariffs on H-shaped steel products.

The consultation, related to H-shaped steel products importedfrom China (including Hong Kong), will be held on June 20, wherein

V I E T N A M


all parties will get the opportunity to express their opinions onanti-dumping tariffs.

Applications to participate in the consultation have to be sent tothe VCA’s Trade Remedies Investigation Division before 5pm onJune 5, and concerned parties can send their contents before5pm on June 9.

VCA’s deputy director Nguyen Phýõng Nam said the publicconsultation would be based on Order No 20 on anti-dumpingtariff on goods imported into Vit Nam, and Decree No 90 on theimplementation of this order.

Earlier, the ministry had issued a decree imposing temporaryanti-dumping duties on H-shaped steel products imported fromChina. Under Decree No 957/2017/QÐ-BTC, anti-dumping dutiesimposed for all Chinese steel produders exported to Vit Nam is36.33 per cent and will be in effect from April 5 to August 2, 2017.

However, some companies such as Heibei Jinxi Iron and SteelGroup and Hebei Jinxi Section Steel were charged lower anti-dumping taxes at 29.4 per cent, others such as Rizhao SteelHolding Group and Rizhao Medium Section Mill were charged at21.18 per cent.

H-shaped steel products are used to make support beams duringconstructions, girders for containers and trucks, steel decks andchassis.


Vietnamese steel suffers slow growth

Vietnamese steel production and sales growth are slowing, whileconstruction steel consumption has decreased, the Viet Nam SteelAssociation (VSA) announced.

VSA said operation of steel plants both in the north and southlast month was quiet compared to the previous month. Somefirms have faced difficulties and could suffer losses soon.

Steel prices continue their downward trend, making competitionto maintain market shares more severe.

The local steel price in April was reduced by VNÐ400-700 perkilo from the previous month to VND10,600 - VND10,800excluding VAT.

VSA said the steel sales growth in the first four months of theyear was only 2.7 per cent, much lower than the forecast of 10per cent earlier this year.

The scrap price in the first half of this month decreased by $20-25 per tonne to $255-265 per tonne. The price of steel billet wassharply reduced by $20-25 per tonne to $390-400 per tonne.

Nguyen Vãn Sua, VSA’s chairman, said its members’ constructionsteel April output was more than 730,000 tonnes, representing aslight year-on-year increase of 3.6 per cent. However, the outputlast month was reduced by 14 per cent from the previous month.Consumption of building steel last month also posted 14 percent and 20 per cent decreases in comparison with the sameperiod last year and previous month respectively to reach635,000 tonnes.

Sua said steel businesses have continued their discount andprice guarantee policies, causing difficulties to the domesticmarket. Cheap imported rolled steel has also burdened localproducers.

The association suggested that steel firms should keep the marketstable, removing price guarantee policies while reducing andlimiting sale support policies.

Local companies should regularly exchange information andreport to the association to keep competition in the steel markethealthy.

In addition, they should co-operate with each other to create asynchronous and sustainable association chain.

The association will continue to analyse and provide informationon the massive imports of long steel pipes and rolled coat steel,as well as affects of taxes imposed on steel billet to localproducers to avoid speculation.


Formosa Ha Tinh to fire first blast furnace this month

Formosa Ha Tinh Steel (FHS), the new integrated steelworks innorth-central Vietnam’s Ha Tinh province, aims to blow-in itsfirst 4,350 cubic meter blast furnace within the last week of thismonth, a company source told S&P Global Platts Monday. FHSremains confident of the date to fire its furnace despite notreceiving its operational license as yet from the prime minister’soffice, the source said. He was unfazed because thecompany hadalready received approval for the go-ahead from the centralgovernment earlier.

The blast furnace would give the works a crude steel capacity of3.5 million mt/year, with a second furnace of identical capacity,planned for commissioning a year later, effectively doublingcapacity.

The company’s operations are being closely monitored by theregional steel industry, particularly its planned flats operations,as the Ha Tinh plant’s start would finally free Vietnam from beingentirely dependent on imports for its hot coils. Vietnam’s HRCimports, mostly from China, amounted to around 11 million mtlast year.

When the first furnace is fully bedded down, FHS aims to sell239,000 mt/year of billet, 1.386 million mt/y of HRC and 1.223million mt/y of hot rolled band. The company also plans to sell300,000 mt/y of wire rod from one dedicated rod mill and also300,000 mt/y of bar-in-coil/wire rod from another mill.

“The original plan is to operate a second furnace (in this firstphase) one year later. But we need to see the situation afteroperating the first so we will decide after,” he said.

Formosa Ha Tinh, owned 70% by Formosa Plastics, 25% by ChinaSteel Corp (CSC) and 5% by Japan’s JFE Steel, had postponed itsscheduled BF operations from their originally-planned June 2016start. FHS was implicated in a massive marine pollution casewhich resulted in the steelmaker being slapped with a $500


million fine, as Platts reported. The company is currently feedingits hot strip mill with slab from CSC.


Vietnamese output rises in Q1, but imports stay high

Vietnamese steel production was robust during the first quarterof this year. On the back of a GDP growth target of 6.7% for 2017,the Vietnam Steel Association is hoping that overall steelproduction in Vietnam will rise by12% this year, said Chu DucKhai, vice chairman and general secretary of the Vietnam SteelAssociation.

The country’s production of finished steel during the first quarterof this year rose by 18.8% when compared to the first quarter of2016. Its production of long products was up 23.8% to 2.22 millionmt, metallic-coated and color-coated steel up 13.8% to 995,000mt and welded pipe 31.6% higher to 491,000 mt. The increase inVietnamese cold rolled coil output was 7.8% to 894,000 mt.

During the first quarter, Vietnamese apparent consumption oflong products amounted to 3.68 million mt, and for flats 3.23million mt. In 2016, Vietnamese overall apparent steelconsumption rose by a significant 23% on-year to 22.67 millionmt.

The country imported a massive 17.4 million mt of long and flatsteel products to meet its strong demand. Khai noted that thecountry “is at risk” of being a consumption market for imports.

Imports comprised more than 4.5 million mt of alloy steel, nearly2 million mt of wire rod and drawn wire, and nearly 1.9 millionmt of hot-dip galvanized and prepainted galvanized sheet. Likethe rest of the countries in Asean, Vietnam faces a “huge” volumeof imports from China, Khai said.


Second review of anti-dumping duties on imported steel

The Ministry of Industry and Trade (MoIT) has issued a decisionto conduct a second review of anti-dumping duties on importedcold-rolled stainless steel.

Decision No 1849/QÐ-BTC, dated May 23, 2017, was issued inresponse to a review proposal submitted by several steel importcompanies and firms that sell steel to Viet Nam.

The period for the second review is from May 1, 2016 to April 30,2017.

As per the country’s anti-dumping regulations, concerned partiescan request for a review of anti-dumping duties one year afterthe decision to impose it.

On September 5, 2014, the MoIT had issued Decision No 7896/QÐ-BTC related to imposing anti-dumping duties on several cold-rolled stainless steel products imported to Viet Nam fromcountries and territories including China, Indonesia, Malaysiaand Taiwan.

The first review concluded on April 29, 2016.

After the first review, the anti-dumping duty on cold-rolledstainless steel imported from China-based Shanxi TaigangStainless Steel Co Ltd was hiked from 6.58 per cent to 17.47 percent, and from between 4.64 and 6.87 per cent to 25.35 per centfor other Chinese steel producers.

Cold-rolled stainless steel products from Indonesia was leviedan anti-dumping duty of 13.03 per cent, up from 3.07 per cent.

On the other hand, duty on products from Malaysia droppedfrom 10.71 to 9.55 per cent.

For products from Taiwan, the duty was maintained at between13.79 and 37.29 per cent.

The duties are applicable from May 14, 2016, to October 6, 2019,as per the results of the first review.


Brazil’s April steel production up 26% on year

Brazil’s crude steel production in April was 2.89 million mt, up26% from 2.30 million mt in the same month a year ago, steelinstitute Aco Brasil said Wednesday. Production was up 1.7%from 2.84 million mt in March.

Production of finished steel products in April totaled 1.88 millionmt, up 15% from 1.63 million mt last year but down 3% from 1.94million mt in March, Aco Brasil said.

Finished steel shipments to the domestic market totaled 1.18million mt in April, down 13% from 1.35 million mt a year ago.When compared with March, shipments to the domestic marketwere down 19% to 1.46 million mt.

Finished steel exports in April totaled 826,000 mt, valued at$457 million, a decrease of 18% compared with April 2016, whenthe volume came to 1.01 million mt valued at $383 million. InMarch, exports totaled 1.38 million mt valued at $731 million.

Imports in April were 153,000 mt, up 37% from 112,000 mt inApril 2016 valued at $152 million against $126 million in April2016. In March, imports totaled 268,000 mt valued at 218million.

Apparent steel consumption in April was 1.4 million mt, 9% lowerthan 1.5 million mt in the same month a year ago. In March, totalapparent consumption was 1.7 million mt.


Steel exports surge 142%, imports down 23% in April

Overtaking imports, India’s steel exports jumped by 142 per centin April to 0.747 million tonnes (mt) as compared to 0.308 mt inthe same month last year, said a Steel Ministry report.

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I N D I A


Steel imports were down by 23 per cent to 0.504 mt in the lastmonth from 0.654 mt imported in the corresponding month ofthe last financial year (FY).

“Export of total finished steel was up by 142 per cent in April2017 to 0.747 mt over April 2016 and declined by 54 per centover March 2017. Import of total finished steel at 0.504 mt inApril declined by 23 per cent over April 2016 and also declinedby 16 per cent over March 2017. India was a net exporter of totalfinished steel in April 2017,” said the report of Joint PlantCommittee.

India’s consumption of total finished steel saw a growth of 3.4per cent at 6.015 mt in the first month of the current FY over thesame period last year but declined by 22 per cent over March2017, under the influence of a declining supply side as bothproduction for sale and imports declined in April 2017 overMarch.

In April, production for sale of total finished steel at 8.43 mt,registered a growth of 8.7 per cent over corresponding monthlast year.

The production was, however, down by 8.6 per cent over March2017.

SAIL, RINL, TSL, Essar, JSWL and JSPL together produced 4.786 mtduring April 2017 which was a growth of 11 per cent over lastyear, the report said.

The rest was 4.478 mt coming from the other producers, whichwas a growth of 6 per cent, it added.

Meanwhile, the Union Cabinet, earlier this month, gave itsapproval to the National Steel Policy, 2017 which projects crudesteel capacity of 300 million tonnes (mt), production of 255 mtand a robust finished steel per capita consumption of 158 kg by2030-31, as against the current consumption of 61 kg.

According to the policy, the 300 mt of steel making capacity wouldtranslate into additional investment of Rs 10 lakh crore by 2030-31.

CRISIL Research, however, said in a report, that “the government’svision of adding 182 mt of new capacities over the next 14 yearsseems unlikely, given that only 60 mt of capacity was added inthe past decade”.

“Further, stagnant demand in past five years has impactedutilisation, and also aggravated the debt position of the steelsector,” it said.

The research agency expects 24-26 mt of steel capacities to beadded over the next five years, leading to aggregate steel capacityto rise to 140-145 mt by 2021-22.

Business Standard, May 15, 2017

India slaps anti-dumping duties on Korean steel for 5 yrs

India has slapped anti-dumping duties on South Korean steelproducts for five years to better protect its homegrown industry,the country’s trade promotion agency said Tuesday.

“India has aggressively expanded its steel plants to meet growinglocal demand and increase exports. Steel imports from countrieslike South Korea, China and Japan have also jumped in recentyears due to global oversupply,” said a spokesman at the KoreaTrade-Investment Promotion Agency.

“The Indian government began to take measures aimed atprotecting local steel mills in 2015, including a hike in tariffs onimported steel products,” he said.

India’s finance ministry already imposed $474-$594 per ton inanti-dumping duties on South Korean steel products for sixmonths from Aug. 8 last year. On Monday, the ministry announcedit will slap duties of $478-$561 a ton on Korean products for thenext 4 1/2 years, a New Delhi-based Kotra official said in a report.

An anti-dumping duty is a tariff a government imposes onimporters who price their goods below fair market value.

Kotra expected India’s latest action will weigh on the bottom lineof Korean steelmakers for the time being as the emerging countryis determined to bolster its own steel industry.

Indian steelmakers contribute 2 percent of the country’s grossdomestic product and hire some 2 million workers. India ranksthird in terms of steel output after China and the United States,according to India’s Ministry of Steel.

As of September 2016, South Korean steelmakers accounted for24 percent of India’s imported steel market, according to IHSGlobal Trade Atlas.

Yonhap, May 17, 2017

India on right path to becoming global steel player: SteelAssociation

India turned net exporter of steel this year and the trend isexpected to continue as the metal’s quality has become globallycompetitive, according to Indian Steel Association. This is thebeginning for India towards becoming a global player, theassociation said. The country is no doubt on the right path. “It isalready a net exporter.

This will give strength to domestic production so that the entireproduction may not be intended for domestic consumption andsome positive development needs to move further,” theassociation added. “From September 2014 till end of September2016 huge imports came to India, and since about beginning ofthis year, it shows the trend of becoming a net exporter,” SanakMishra, Secretary General and Executive Head, Indian SteelAssociation (ISA) told PTI in an interview.

On account of measures taken by the government, the importsfell last fiscal year ending March, and from beginning of the newcalender year itself, the exports were larger than the imports, hesaid. According to official figures, production of total finishedsteel stood at 101.274 MT in April-March 2016-17.

Steel export was up by 102.1% in April-March 2016-17 (8.244MT) over same period of last year. Meanwhile, steel import wasat 7.427 MT in April-March 2016-17, a decline of 36.6% oversame period of previous year. The ISA expects this trend will


continue as the Indian steel is competitive in the global marketin terms of quality and delivery, Mishra said. “(There) is newtechnology, equipment, automation and process control.

So, India is in position to compete for exports. Secondly, in anideal situation export should be at least as much as you import.We have crossed that at the moment, our exports are larger thanimports but the fact is that this quantity is not very large.

“India should increase its exports as the figures at present arenot very much high. To present itself as a global player, Indiashould continue to export to get better value and present itselfas a global player,” he said. “We should not be too euphoricabout it. It is beginning of India being a global player.

When it will reach 15 million tonnes then internationally, peoplewill notice that India is exporting so much of steel,” he added.Besides raising production, India should also start looking fornew markets. These could be to countries which are importingsteel, which have less production capacity, where economy isrising but steel production is not, he said.

LiveMint, May 30, 2017

China to cut steel capacity but excess output still expected –Eurofer

China is serious about cutting millions of tonnes of excess steelcapacity but that will not mean lower production, particularlyin the next few quarters, the head of the European Union steelbody Eurofer said on Wednesday.

China pledged early last year to cut 150 million tonnes of excesscapacity by 2020. The move, along with rising steel trade barriersand an infrastructure spending splurge by Beijing, helped globalsteel prices surge 45 percent since December 2015.

But Chinese steel prices have slipped in recent weeks on concernsabout a slowdown in construction and infrastructure projects.

“I think the Chinese government has a genuine goal of reducingcapacity because they subsidize it, its costing them lots of money… but cutting capacity doesn’t mean you cut production,” Euroferpresident Geert Van Poelvoorde said.

“There will be in the next quarters more overproduction in China,”he told the European Steel Day conference in Brussels.

Output in China, which accounts for half of global steelproduction, rose 4.6 percent in the first quarter to 201.1 milliontonnes, after a 1.2 percent increase to 808.4 million tonnes lastyear.

However, Chinese steelmaking capacity has fallen. China, whichholds nearly half the world’s 800 million tonnes of spare capacity,cut 65 million tonnes of capacity in 2016 and aims to cut another50 million tonnes this year.

China’s cuts last year, part of a crackdown on pollutingindustries, mostly involved idled plants. Closing other plantsmay be more difficult because of the risk of social unrest as jobsare lost in the labor intensive steel industry.

C H I N A

“China is complex, most plants are in the provinces. When thecentral government decides something, it doesn’t mean theprovinces execute it,” said Van Poelvoorde, who is also CEO ofArcelorMittal Europe Flat Steel Products.

“It’s not so easy to implement and what they (will) manage to dois not so clear,” he said.

In addition, he said China’s cuts might not be enough to balancean oversupplied market as Iran and Russia, amongst others,have added new capacity beyond their domestic needs. “They’llstart to export much more, so for sure China’s cuts won’t beenough,” he said.

A report by the Organisation for Economic Cooperation (OECD)and Development said global steel capacity rose 1.4 percent in2016 to 2.39 billion tonnes.

Iran has 19 projects planed between now and 2019 that willexpand capacity by almost 24 million tonnes, adding to existingestimated capacity of 28 million tonnes now, the OECD said.

Reuters, May 12, 2017

Chinese economy ‘buoyed by steel, infrastructure’

The Chinese economy will remain strong over the coming years,although traditional industries will become less important asthe economy grows more sophisticated, according to a partnerat US law firm Meyer, Unkovic & Scott.

“I think there will be less manufacturing in China in the future,but it will be better. It will be more competitive,” Dennis Unkovicsaid at the American Tin Trade Assn’s spring meeting in Pittsburghon Friday May 19.

He expects the country to continue growing at a “fairly strong”rate of 6.5% per year over the next few years, he added.

However, the country’s traditional growth sectors of vehicles,textiles and clothing will fall to the wayside.

Two of the main factors in the downturn in these industries arethat average wages for workers are increasing “quickly” but energycosts are not falling, Unkovic said.

Both the textile and apparel industries have started shifting toBangladesh and Vietnam. “These are traditional industries thatmade China strong that are now weakening,” he said.

Chinese steelOne exception to this Chinese trend is the steel industry, whichwill probably remain strong over the next few years, he believed.

“It’s clear to me that the Chinese government is going to force alot of these smaller steel companies, that are highly inefficient,to go out of business,” he said.

Infrastructure investment also is not slowing down, he added,and China will invest $2.17 trillion in infrastructure until 2020,which “will have the ability to prop up the Chinese economy overthe next couple years”.


The Chinese economy is shifting to becoming more globallycompetitive and is entering industries such as computer chips,aerospace, new energy vehicles and alternative energy, accordingto Unkovic.

For example, state-owned Commercial Aircraft Corp of China(Comac) has developed a passenger jet, the C919, that is expectedto come to the market in 2019 or 2020 and to compete withaircraft created by France’s Airbus and USA-based Boeing.

Another example of Chinese development is the high-speed bullettrain. “The Chinese built, in nine years, the rail system that we’venever been able to do in [the USA],” he said.

Uneducated massesBut one of the main challenges that the country faces is that two-thirds of China’s population, or about 800 million people, earnless than the minimum wage and “aren’t educated for the neweconomy”, Unkovic said.

The remaining one-third live in Chinese cities and are welleducated, he said, but the government is “still restricting thenumber of people who can move from the country to cities”.

The massive number of uneducated people in the country “keepsthe Chinese leaders up at night”, he said. For now, they are ableto work in manufacturing by building bullet trains and ghosttowns, but the big question is: what will come next.

The government “worries that the less-educated people won’t beable to fit with the jobs that exist”, according to Unkovic.

Another hurdle that the country faces is that many Chinese peopleinvest their money overseas despite efforts by the government tokeep funds within the country.

“There will be more money transferred out of China in the nextten years than has ever been transferred in the history of theworld,” he said.

The government would like people to invest their money in China,and while it has been “putting lots of pressure on the Chinesepeople to keep money in, they can’t [stop it going out]. People areputting money into [residences] and apartments in Canada andAustralia.”

Optimism on prospectsDespite the obstacles faced by the country and its people, Unkovicis optimistic about China’s prospects. First, he expects the countryto control its pollution problem within the next ten years.

“They will spend whatever it takes. Chinese people are dying.They can’t live in that country. Somehow, they’ll acquire thetechnology to clean it up,” he said.

The country also is cleaning up its corruption issues. PresidentXi Jinping is “the first leader in China who has attempted tocontrol corruption”, Unkovic said.

This will help the USA since “if you’re trying to do business inChina, the ability to do it without bribing people is much, muchbetter that it was”, he said.

The USA and China will probably create improved ties over thenext three to four years, primarily because of a friendlyrelationship between Xi and US President Donald Trump, Unkovicsaid.

“The Chinese understand Donald Trump,” he explained. “Trumpprides himself, then family, then friends. He views the world asthe Chinese do. They have insight into each other.”


Masteel upgrades SBQ production with new rolling block

China’s Maanshan Iron & Steel (Masteel) is to upgrade itsproduction of special bar quality (SBQ) steels with the installationof a new finishing unit on its rolling mill. German plantmakerFriedrich Kocks said it will supply a three-roll reducing and sizingblock (RSB) to improve finished bar tolerances.

The RSB will be installed behind a continuous roughing andintermediate train consisting of 22 horizontal-vertical stands,and is designed for temperature-controlled rolling at lowtemperatures.

Finished products are straight bars in the diameter range of16.0-100.0mm for applications in automotive, aerospace andmechanical engineering. The rolling mill’s capacity is 400,000metric tons/year.

Kocks said commissioning of the RSB is scheduled for mid-2018.Platts, May 23, 2017

Iran Steel Exports Up 83%

Steelmakers exported 359,572 tons of semi-finished and finishedsteel products, including billet, bloom, slab, rebar, beam andcoil, in the first month of the current fiscal year ending April 20,indicating an 83% growth compared with last year ’scorresponding period, Iranian Mines and Mining IndustriesDevelopment and Renovation Organization reported.

Khouzestan Steel Company was the top exporter with 167,095tons, followed by Esfahan Steel Company with 62,421 tons,Hormozgan Steel Company with 52,000 tons, Mobarakeh SteelCompany with 50,669 tons, Iran Alloy Steel Company with 21,778tons, Khorasan Steel Company with 4,249 tons and Oxin SteelCompany with 1,361 tons.

Iran exported 3.74 million tons of semis and 1.79 million tons offinished steel products in the last fiscal year (March 2016-17),registering a 108% and 16% growth respectively, according toIranian Steel Producers Association.

Thailand, the UAE, and Taiwan were the main customers ofIranian steel, accounting for 16%, 12% and 11% of 5.53 milliontons of total exports, according to IMIDRO.

Italy with 9%, Oman with 7%, China with 7%, Iraq with 6%,Afghanistan with 5%, Jordan with 3%, Turkey with 3%, Egypt with3%, Brazil with 3%, Spain with 2%, Morocco with 2% andTurkmenistan with 2% followed.

Financial Tribune, May 11, 2017

W O R L D


US to impose anti-dumping, countervailing duties on CTL plates

The International Trade Commission (ITC) of the United Statesdecided on May 5 to impose anti-dumping duties on carbon andalloy steel cut-to-length (CTL) plates imported from the eightcountries including South Korea. The ITC also imposedcountervailing duties on those imported from South Korea,claiming that the South Korean government’s subsidies arepredicted to affect the industry in the United States.

The anti-dumping and countervailing duties on the South Koreanproducts are 7.39% and 4.31%, respectively. The anti-dumpingduties on those imported from Belgium, France, Italy and Japanamount to up to 51.78%, 148.02%, 22.19% and 48.67% withAdverse Facts Available (AFA) rates applied.

The ITC is planning to notify the U.S. Department of Commerce ofits decision on May 18. Then, the U.S. Department of Commercenotifies the U.S. Customs and Border Protection of it and thetariffs become effective.

The Ministry of Trade, Industry & Energy of South Korea said inresponse that it would file a lawsuit with the World TradeOrganization (WTO) in the event of excessive punitive tariffs inthe form of AFA and Particular Market Situation (PMS). In addition,the ministry is going to bring lawyers, accountants and scholarsspecialized in international trade into its task force againstimport restrictions and prepare measures against Section 232of the Trade Expansion Act and so on. At the same time, the SouthKorean government is planning to make better use of bilateralnegotiations and multilateral channels such as the WTO Anti-Dumping Committee.

Business Korea, May 12, 2017

Southeast Asian steel billet buyers start to accept costlier non-Chinese material

Steel billet import prices started to move up in Southeast Asiaover the past week as more importers in the region began tobelieve that the firmness in the Chinese market might be here tostay.

Metal Bulletin’s price assessment for billet imports in SoutheastAsia was $405-415 per tonne cfr for the week ending MondayMay 22, up by $5 per tonne from $400-410 per tonne cfr in thepreceding week.

IndonesiaIn Indonesia, a 15,000-tonne cargo of 150mm billet from Russiawas heard priced at less than $410 per tonne cfr last week, forshipment from Russian Far East ports.

Local rebar prices in the country have been hovering around$460-465 per tonne. As the total costs to convert billet to rebarare around $60 per tonne – including costs to unload cargoes atthe port and transport them to the mills – most buyers continueto look at only $400-405 per tonne cfr for imported material,sources said.

“Rebar producers can’t afford to pay more than that,” one Jakarta-based trader said on May 24.

Indonesian re-rollers producing wire rod or sections could acceptcostlier billet, with market participants indicating prices as highas $415-420 per tonne cfr in such cases.

A 5,000-tonne cargo from a Thai electric arc furnace (EAF) mill,for instance, was heard sold late last week at around $405 pertonne fob. It was destined for Indonesia, which would mean afinal price close to $420 per tonne cfr.

And a bigger cargo from a second Thai EAF producer, of as muchas 15,000 tonnes, was heard sold just below $420 per tonne cfr.

There have been widespread rumours that a number of Indonesianbuyers are worried about the fulfilment of bookings they haveclosed in recent weeks at $395-405 per tonne cfr, for Chinesematerial.

“Traders were short-selling at those [prices] and they might notbe able to deliver, now [that prices from China have moved up inrecent weeks],” one buyer source in Indonesia said.

If shipments are delayed or cancelled, a few of these buyersmight need to accept higher prices for prompt-shipment cargoesof non-Chinese material, sources said.

PhilippinesIn the Philippines, news emerged early this week about at leasttwo bookings late last week around $425 per tonne cfr.

Both deals would comprise 10,000 tonnes of EAF-produced billet,one of them from Thailand and the other from Vietnam, sourcesin Manila, Bangkok and Ho Chi Minh City said.

The sales might have been made to the same buyer in thePhilippines, with traders in Manila still unsure whether otherlocal billet re-rollers would accept such prices.

“There are offers in the market at $430-435 per tonne cfr butbuyers are not showing any interest,” one trader said.

Market participants in the Philippines have also been eagerlywaiting to see whether a visit this week by their country’spresident, Rodrigo Duterte, to Moscow would result in theelimination of an import duty on Russian billet.

Currently, there is a 3% import duty on billet from most of theworld’s countries, including Russia, Ukraine and Turkey. Materialfrom the Assn of Southeast Asian Nations (Asean) region andfrom countries with which Asean has free trade agreements –such as China – face no duty.

“If the duty on Russian billet is eliminated or reduced, Russianbillet would become very competitive here,” a second trader said.

VietnamIn Vietnam, meanwhile, 20,000 tonnes of Thai billet in 150mmsize and grade equivalent to 5sp was heard sold at $415 pertonne cfr in recent days.

A safeguard duty currently at 21.3% on billet imports in Vietnamdoes not apply to material from Thailand and 132 otherdeveloping countries.


‘Confusion’Despite the firmness of the market in recent weeks, several buyersthroughout Southeast Asia were still “not really sure” about thesustainability of the high prices coming out of China, one regionaltrader in Singapore said on Wednesday.

“The confusion is still there,” he added.

One trader in Indonesia even made a guess on the market’s likelydirection, based on very recent information about Chinese traderslowering their prices for position cargoes. “I think next weekprices will come down,” he said.

Late on May 24, billet in China’s Tangshan was trading at 3,060yuan ($444) per tonne including VAT, down by 80 yuan ($12) fromthe previous day.


SEAISI CONF: How Southeast Asia’s steel industries view China

China, with its excess capacity, continues to be seen as a threatfor the steel industries of Southeast Asian nations, but a silverlining may be in the horizon with Beijing pushing ahead with itsBelt & Road Initiative.

Officials from several of those nations gave their take on thesituation to delegates at the 2017 South East Asia Iron & SteelInstitute (Seaisi) conference earlier this week.

Vietnam“Much like other countries in the rest of the world, particularlythose in the region, Vietnam receives large volumes of steelimports from China,” Chu Duc Khai, the vice-chairman and generalsecretary of the Vietnam Steel Assn (VSA), told delegates onTuesday May 23.

He warned that Vietnam was “at risk of becoming a consumptionmarket for imported steel products in 2016”, and said theassociation was planning to request its government to implementtrade measures to protect its domestic steel industry from theeffects of oversupply and fluctuating prices elsewhere.

Vietnam’s apparent steel consumption, calculated by addingdomestic production to imports and subtracting exports, totalled22.67 million tonnes in 2016, up 23% from a year earlier,according to the VSA. The country imported 17.40 million tonnesof steel products last year, a 25% year-on-year increase, it said.

The Philippines and IndonesiaMeanwhile, steel industry officials from the Philippines andIndonesia too have expressed their concerns over imports fromChina.

Imports of semi-finished and finished steel from China to thePhilippines experienced a significant increase in 2016, puttingpressure on the domestic industry, an official from the PhilippineIron & Steel Institute said.

The Philippines’ apparent steel consumption totalled 9.68million tonnes last year, up 10% compared with 8.75 milliontonnes in 2015, while its finished steel imports rose 11% to 5.50million tonnes, statistics from the institute showed.

Similarly, an official at the Indonesian Iron & Steel Industry Assnsaid that the global oversupply of steel, a big part of which isattributed to China, was a major challenge for Indonesia’s steelindustry.

The country’s apparent steel consumption increased 11.43% to12.67 million tonnes last year while its finished steel importsrose 5.52% to 6.88 million tonnes, according to the association.

MalaysiaChina’s excess capacity features quite high up in the list ofconcerns for the Malaysian Iron & Steel Industry Federation(Misif), its president Soh Thian Lai revealed.

Misif estimates that Malaysia’s apparent steel consumption in2016 was up 3.4%, at 10.34 million tonnes.

In the same year, the country’s steel imports surged by 15.3% to9.13 million tonnes, with China accounting for 40%, or 3.67million tonnes, of that total.

Nevertheless, Misif expects China’s Belt & Road Initiative tobenefit Malaysia’s economy and industries in the years to come,Soh said.

Deals worth some 31 billion ringgit ($7.19 billion) have beensigned between Malaysian and Chinese companies under theinitiative, he told delegates, saying: “The mega deals will spurhigh demand for Malaysian infrastructure, [and] constructionmaterials [among others].”


Too soon to weigh impact of Section 232 on US producers

While concerns and uncertainties surrounding the US Departmentof Commerce’s Section 232 investigation were heard to be slowingthe import market, US steelmakers say it’s still too early to tellwhat effect the investigation will have on their business.

“It would be nice to believe there will be some impact down theroad, but I think it’s too early to speculate,” Gerdau Long SteelNorth America President Peter Campo said during a mediabriefing at the American Iron and Steel Institute and SteelManufacturers Association’s 2017 joint general meeting inWashington DC.

Commerce in April announced it was conducting a Section 232investigation regarding the US steel industry and the impact ofsteel imports on national security. Since the investigation wasannounced, traders have said sales to the US are down asexporters are uncertain about the potential outcome and what itmight mean for their business, as S&P Global Platts previouslyreported.

“Uncertainty is the steel business,” said AK Steel CEO RogerNewport.

While a Section 232 investigation is a different tool in the UStrade arsenal, it doesn’t change the end goal forUS producers,according to Newport.


“What we’re focused on is making sure there is fair trade,” hesaid, adding that while antidumping and countervailing dutytrade cases have helped US producers work toward a more levelplaying field, they haven’t been enough to fully resolve theproblem. “We’ve been very vocal about [our focus] as a companyand as an industry. It’s not about trying to prevent imports, it’s tohave fair trade and a level playing field. That’s what we’re reallytrying to do; find a solution that gets us there and the 232 is anaction.”

From a customer perspective, Newport said there’s littledifference in a Section 232 investigation when compared withthe traditional AD/CVD cases.

“It’s actions we’re taking to make sure it’s a level playingfield...and that we enforce our laws. [It’s] no different than whatwe’ve done in the past couple of years whether it’s been in thecarbon, stainless or electrical [steel] world of filing trade casesto address that.”

At the same time, the industry continues to file and move forwardwith AD and CVD cases, Campo said. “That behavior is still illegaland we’re finding support from the new administration toprosecute those as we can, so I think it would be very difficult topinpoint one particular action or the potential impact of 232 inadvance,” he said.


Construction productivity in Singapore – changing the way theybuild

At the 2017 SEAISI Conference & Exhibition held in Singapore, Dr.John Keung, CEO of Singapore’s Building and ConstructionAuthority, shared the concept of how to improve constructionproductivity in the country.

Singapore is a small country with a limited land area of 720 km2

and a population of 5.6 million people. The country’s economicgrowth has been stagnating at around 1-2% each year.

Pre-2010, Singapore was facing the problem of inexperiencedforeign workers growth in tandem with growing constructionoutput in the country as the sector was labour intensive. Out ofthe total of more than 360,000 workers in the construction sector,approximately 70% were foreigners and 49% of the total wereinexperienced workforce (with experience of less than 4 years).This was one of the main reasons for the high production costand low productivity for the construction sector in Singaporebefore 2010.

In view of the above, the Singapore government started to embarkon an aggressive plan to address the productivity problem. Theyhave implemented several measures with the aim of improvingproductivity in the construction sector. They are:

1. Raise manpower cost to drive technology substitution

The government set quotas for foreign workers andraised the foreign worker levy. W ith that, theconstruction sector is forced to go for technologysubstitution in order to reduce cost.

2. Set minimum standard through the buildabilityframeworkSet minimum buildable design score for architects and

H E A D L I N E S

engineer work and a minimum constructability scorefor builders.

3. Incentivize private sector to be 1st moversProvided funds to, i) build capability through trainingcourses, giving scholarship, sponsorship to enhancedbuilt environment, ii) integrate value chain inconstruction sector by introducing Building InformationModelling (BIM) Fund, and iii) adopt technology forconstruction sector. The government introducedMechanisation Credit (MechC) Scheme and ProductivityImprovement Projects (PIP) for the industry.

Mechanisation Credit (MechC) Scheme is to encouragebuidlers to mechanise manual workers and reducelabour reliance. The government provides support byco-funding equipment purchase and lease

Productivity Improvement Projects (PIP) is to encouragetechnology adoption and process re-engineering throughproject co-funding

4. Drive BIM adoption through regulation to level upindustry

Starting from 2010, the government launched BIM to theindustry and BIM submission was voluntary. In 2015,the country successfully made BIM submissionmandatory for new building projects of more than5,000m2

5. Drive productivity through public sector procurementThe government aims to achieve 25-30% productivityimprovement from 2010 levels for all new projectslaunched in the country.

6. Nurture a pipeline of building professionalsMany training programmes and seminars have beenprovided as well as scholarships and sponsorships forall levels, from diplomas to degree courses in

universities.

The government has set productivity target with an annual averageof 2-3% productivity improvement by 2020. According to Dr.Keung, within 6 years from 2010, there was a total 10% cumulativeimprovement in site productivity (defined as floor area completedper manday). The composition of workforce in the constructionsector also improved from 2% higher skilled R1 workers in 2011

to 40% in 2010.

The government also takes it seriously in terms of increasingadoption of BIM across the construction value chain. In 2016,86% of larger consultants in Singapore have adopted BIM intheir businesses, while 65% of the larger contractors have alsodone the same. Meanwhile, 42% of smaller consultants and 47%of small contractors have adopted BIM.

Singapore’s construction firms have also adopted the idea ofDfMA or Design for Manufacturing and Assembly in theirconstruction works. With this, there will be more control onoffsite environment by using more automation and offshoringworks. As a result, the Prefabricated Prefinished VolumetricConstruction or PPVC method was also introduced. In the case ofthe construction of the Crowne Plaza Changi Airport Hotel, whichused PPVC methods, 40% fewer workers were needed on-site andthe construction of one storey of the building took only 3-4 days,compared to 14-21 days for conventional methods. There wasan overall productivity boost of about 45%.The government aimsto achieve the target of 40% adoption rate for DfMA technologiesby 2020.

SEAISI, May 2017

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