According to the latest reports, Philippines’ largest steel producer, Steel Asia is set to double its capacity (from the current level of 2.1 MnT) for the production of steel products which are currently not manufactured in the local market.
This investment plan includes development of more upstream facilities with the establishment of new integrated steelmaking plants using recycling technologies and expansion of its midstream and downstream products to include H beams, sheet piles, wire rods, steel plates, and reinforcing steel mesh that will enable the country to produce basic steel-based materials like pipes, tools, and machinery parts.
The total investment estimated in this expansion work is over Philippines Peso 100 billion (USD 500 million) and is focused on basic sectors to substitute imports and create linkages to support infrastructure development and downstream industries.
Philippines only produced reinforcement steel or rebars through Steel Asia, which is also the largest rebar manufacturer in Southeast Asia but the booming infrastructure activities in the Philippines has supported the company’s investment plans.
According to the company’s top management, the expansion work will enable Steel Asia to manufacture two steel products that are entirely imported in Philippines. Also, the company will have their own scrap recycling facilities that will convert the scrap — as a raw material — to billet, and the billet as raw material for sections and wire rods.
At present about 1-2 MnT of scrap goes out of Philippines, mostly to China, and is converted into billets, blooms, and slabs — which are raw materials for midstream steel products such as rebar, angle, sections, wire rods, hot rolled coil, and plate — and imported back to the Philippines. Currently, Steel Asia imports 80% of its billets requirement. However, when this expansion work in completed, the company will become 60% self-sufficient in terms of its billet requirement.
Steel Asia has six steel plants in Philippines including Meycauayan Works, Calaca Works, Carcar Works, CDO Works, Davao Works, Cebu Works, and Batangas Works.
The company’s total production from its six operating plants reached 1.023 MnT in the first semester (Jan-Jun’18), 11% higher than the 925,503 MT in the same period last year. The firm attributed the record production as of end-June to strong demand from both the public and private sectors which are implementing infrastructure projects.
Of all of Steel Asia’s plants, the steel mill in Meycauayan had the biggest output with 271,329 MT in the first half. Davao Works came in second with 257,032 MT, followed by Calaca Works in Batangas with 255,147 MT output in the January to June period.
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