Malaysian steel firms seek safeguards
Malaysian steel firms seek safeguards.
Malaysian steel players are feeling the heat from their rivals in China and are seeking the government's help for safeguard measures. But local companies must make a case for this together with their peers in Asean, said the International Trade and Industry Minister Datuk Seri Mustapa Mohamed in a dialogue with the Malaysia Iron and Steel Industry Federation in Kuala Lumpur.
Under the China-Asean free trade agreement, which came into effect from early 2010, steel firms have to compete against rivals in China. Meanwhile, aluminium industry players lamented that the Chinese producers are enjoying lower material costs by 10 to 15 per cent compared with Malaysian firms, which buy the metals based on the London Metal Exchange prices. "We have also advised the aluminium producers to talk with their Asean colleagues and come with a strong case before it is brought to the Chinese authorities as a joint submission," he said at a media briefing yesterday. According to the aluminium industry, many countries including India and the European Union, have implemented duties against the import of Chinese aluminium products. The steel players are also urging the government to follow the stand taken by Vietnam and Indonesia to ban the export of scrap metal, saying it is a local resource needed by domestic users.
On the industry's outlook, the federation said the steel industry will continue to grow at a rate of 5 to 7.5 per cent this year. Although it is not specifically identified as a National Key Economic Area (NKEA), iron and steel products will become raw materials supporting the 19 projects and developments for the 10 NKEAs. They are keen to see the construction of the RM36 billion Mass Rapid Transit project, construction of hotels and resorts for tourism development and investments in the gas and energy sector. But they have to use scrap metal in their operations and have to contend with slightly higher scrap metal prices. Scrap metal prices have risen following the uptrend in iron ore and coking coal prices to about US$500 (RM1,520) per tonne from around US$400 (RM1,216) per tonne in December. The dialogue with metal industry players is the second held with industries in Malaysia to address non-tax issues. The metal industry comprises iron and steel and non-ferrous metal (tin, aluminium, copper, zinc and lead) sub sectors.
