The construction recovery in the ASEAN region and the resumption of steel projects frozen during the pandemic will result in new capacities being launched in the region in the coming few years.
New billet capacity of 2 million mt per annum is going to start commissioning by 2024 in the Philippines, according to Ronald Magsajo, representative of the Philippines Iron and Steel Institute and manager at SteelAsia Manufacturing, as stated during the Southeast Asia Iron and Steel Institute (SEAISI) ASEAN Steel Demand Forecast Event.
This billet capacity is a part of the ambitious project of China’s Panhua Group, which earlier was saying that it has plans to build an integrated mill with a total capacity of 10 million mt per year. In 2021, there were not many details on the commissioning timeline as the work on the plant started in 2019, but it was temporarily stopped in 2020 due to the pandemic. Previously, it was announced that Panhua’s project in the Philippines will be focused on flat steel production.
Also, Mr. Magsajo said that SteelAsia’s rebar project with a 400,000 mt capacity in Cebu will be launched by the fourth quarter this year, meaning that at least in 2023 billet imports into the Philippines may rise.
The total billet imports into the Philippines were slightly below 2.5 million mt over the past two years as local production hardly covers 20 percent of total needs, according to SteelOrbis’ data.
Imports of steel to the Philippines, where billets account for the major part, are expected to remain strong in the coming few years, according to Magsajo who stated, “Around 70-80 percent of apparent consumption of crude steel is covered by imports and in the next few years it will continue.”
Construction industry can grow “easily from 11.6 percent to 13.6 percent annually in the next three years,” according to Professor Ronilo Balbieran, vice president of the Research, Education and Institutional Development Foundation. This will be achieved owing to the completion of more “Build Build Build” projects, growth in transportation and storage facilities, as well as resumption of work after the pause in 2020.
