Steel producers from six Southeast Asian countries have asked China to ban Chinese steel plants that were shut for causing pollution, from exporting their equipment to the region, Purwono Widodo, executive committee of the Indonesian Iron & Steel Association (IISA), told reporters on late Wednesday, Feb. 7.
“We support the Chinese government move to crack down on its polluted steel plant. We really appreciate it,” Widodo said. “But we also ask China to make another rule to prohibit the plants from exporting their equipment to other countries,” he said, adding ASEAN steel producers have sent a formal request letter this month. The six countries are Indonesia, Malaysia, Filipina, Thailand, Vietnam, and Singapore.
Equipment from some idled Chinese plants have been shipped to Indonesia, producing cheap, but unsafe long products, Widodo said. He estimates there are at least 10 plants in Indonesia that are using equipment from the Chinese plants. Widodo didn’t give details on the plants and their production capacity.
“Their products are very cheap because there’s no environmental control. The consumers like cheap products, but they’re easily damaged. So it (export of ex-China equipment) harms both producers and consumers,” Widodo said.
The Indonesian government is currently drafting an environmentally-friendly standard for industry, called Standar Industri Hijau or Green Industrial Standard, Widodo said. The steel producers hope the standard would curb the influx of ex-Chinese equipment when it’s implemented, he added.
Steel demand in ASEAN is forecast to reach 83 million tons this year, a 6.8 percent increase from an estimated of 77.7 million tons in 2017, according presentation from IISA. China’s demand is expected to be stable this year, dragging the growth of world steel demand to only 1.6 percent.
Vietnam has the biggest steel consumption among the ASEAN nations of 22 million tons a year. Thailand comes second with 19 million tons, while Indonesia ranks third with 12 million tons.
Steel Consumption
| Country | 2015 | 2016 | Y-o-Y |
| Vietnam | 18,254,000 | 22,324,642 | 22.30% |
| Thailand | 16,686,331 | 19,205,967 | 15.10% |
| Indonesia | 11,375,467 | 12,672,270 | 11.40% |
| Malaysia | 10,000,135 | 10,250,138 | 2.50% |
| Philippines | 8,759,700 | 9,679,469 | 10.50% |
| Singapore | 4,015,522 | 2,830,943 | -29.50% |
| ASEAN | 69,091,155 | 76,963,429 | 11.39% |
Source: IISA
Quantity in MT
ASEAN Steel Consumption Per Capita
| Steel Consumption per capita | 2014 | 2015 | 2016P | 2017F | 2018F | 2019F |
| Indonesia | 51 | 45 | 49 | 51 | 55 | 59 |
| Malaysia | 328 | 321 | 353 | 352 | 351 | 351 |
| Philippines | 73 | 86 | 93 | 97 | 101 | 105 |
| Singapore | 701 | 725 | 530 | 531 | 531 | 531 |
| Thailand | 255 | 242 | 279 | 281 | 288 | 295 |
| Vietnam | 159 | 199 | 241 | 267 | 291 | 314 |
| Asean | 121 | 125 | 139 | 145 | 152 | 159 |
Source: IISA
Quantity in KG
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