Japanese steelmaker Kobe Steel has announced that it has signed a strategic agreement with Malaysia-based Samling to jointly develop the production and sale of black pellets, a next-generation raw material designed to reduce carbon emissions in both steelmaking and power generation.
This move marks Kobe Steel’s latest step in accelerating its role in the global green transition, positioning black pellets as a key enabler for decarbonization in heavy industry.
Details of Kobe Steel-Samling agreement
- Feasibility study: Kobe Steel and Samling will conduct a comprehensive feasibility study for new black pellet production facilities in Sarawak, Malaysia, to be completed by December 2025.
- Technology and resources: the project will combine MUCC’s black pellet manufacturing technology with Samling’s sustainable wood resources in Sarawak.
- Production capacity: the initial goal is at least 300,000 mt per year, with the potential to expand up to 1 million mt annually.
- Regional hub: Sarawak is expected to become a strategic hub for black pellet supply in Asia and beyond.
Timeline and market impact
If the feasibility study is positive, construction of the first facilities could begin as early as 2026, creating a long-term supply chain for black pellets that does not currently exist on a global scale.
The initiative also follows Kobe Steel’s previous collaboration with UBE Mitsubishi Cement Corporation (MUCC), announced in May 2025, to assess the feasibility of black pellet production technology, as SteelOrbis reported previously.
By securing a robust biomass supply chain, Kobe Steel aims to strengthen its competitiveness while supporting international carbon reduction goals.