SteelAsia invests P30B  in heavy steel production

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SteelAsia Manufacturing Corp. is investing P30 billion to produce new steel products in Candelaria, Quezon, its chairman and chief executive officer Benjamin Yao said yesterday.

SteelAsia’s latest project, which Yao called a game changer, will churn out heavy structural steel products that are currently 100 percent imported.

Yao said the Philippines will save $1.2 billion annually from foregone import of heavy structural steel products once SteelAsia’s project goes operational in 2027.

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“The Philippines still has a long way to go in steel manufacturing, “Yao told Malaya Business Insight.

About 90 percent of the Philippines’ steel requirements — except for rebars which SteelAsia produces — is imported mostly from China, Vietnam, Thailand, Korea and Japan.

“This is a game changer initially for the construction and infrastructure sector since this means quicker project completion and lower costs”, Yao said.

Yao said the new project represents the company’s second ongoing investment in new steel products after the P18.3-billion investment in a section mill in Lemery, Batangas. Construction of the plant is ongoing.

Yao said he has embarked on a mission to build the country’s first integrated steel industry and put the country at par with its neighbors.

SteelAsia currently produces steel bars or rebars that are used to reinforce and strengthen concrete under tension for infrastructure and construction projects.

SteelAsia’s heavy sections plant will use the latest European technology to produce over one million tons of structural steel such as H beams, I beam, angles, channels, sheet piles, plates and other heavy profiles.

With a new plant, SteelAsia will be able to create around 7,000 jobs, Yao said.

SteelAsia awarded early this week the engineering, procurement, and construction management for the plant to Chinese firm MCC Huatian Engineering & Technology Co., Ltd., a global leader in this kind of project.

“With this new project, our carbon footprint will also be 90 percent lower than the traditional steelmaking process because we use recycled scrap metal and employ electric arc furnace technology”, said Yao.

SteelAsia said that the delivery lead time to projects will also improve from three-four months for imports to one-two weeks once the Candelaria plant is on stream.

Yao said his company is eyeing a combination of borrowings and internally generated funds to bankroll its latest project.

SteelAsia operates six facilities across the country, with an annual production capacity of over three million MT. 

SteelAsia uses steel scraps to support its rebar production. With the two new mills, it will require 2 million tons of scraps, which Yao said, will all be sourced locally.

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