REBARSTEEL WIRE ROD

RM2,675

RM2,905

RM3,055

July 2022

NOTICEBOARD

THE STEELBILLETSCRAPIRON ORE

RM1,642

RM517

Trade Performance
Malaysia’s Trade Performance, January-July 2022
Malaysia’s Iron and Steel total trade value in July 2022 grew by 15.8 percent to RM5.6 billion compared to RM4.8
billion in July 2021 for the same period. Trade deficit also reduced to RM219.7 million from RM745.8 million
for the same comparison period.
Malaysia’s Iron & Steel export in July 2022 increased by 31.7 percent to RM2.7 billion from RM2.0 billion in July
2021. Three main export destinations in July 2022 were Singapore, USA and Hong Kong, accounted for 21.4, 16.8and 5.7 percent of the total export value respectively.
Malaysia’s Iron & Steel import in July 2022 rose by 4.2 percent from 2.8 billion in July 2021 to 2.9 billion in July
2022. Imports from China, Taiwan and Japan accounted for the top three (3) spots representing 28.3, 14.1 and12.4 percent of the total import value respectively.
From January to July 2022, the total trade value of the Iron and Steel products stood at RM41.1 billion in 2022
compared to RM33.6 billion in the same period in 2021, an increase by 22.3 percent. Further, the trade balance
improved from a trade deficit of RM3.8 billion in 2021 to a trade deficit of RM1.5 billion in 2022 during the same
period of comparison.

Malaysia Trade Performance of Iron & Steel Industry
July 2022: RM5.6billion

Month Trade Value
15.8 % M-o-M change

July 2021: RM4.8billion

July 2022: (RM219.7million)
Trade Deficit

Month Balance of Trade70.5 % M-o-M change

July 2021: (RM745.8million)
Trade Deficit
Month Export
July 2022: RM2.7billion
31.7 % M-o-M change

July 2021: RM2.0billion

Month Import
July 2022: RM2.9billion
4.2 % M-o-M change

July 2021: RM2.8billion

YTD Trade Value
Jan-July 2022: RM41.1billion
22.3 % Y-o-Y change
Jan-July 2021: RM33.6billion

Jan-July 2022: (RM1.5billion)
Trade Deficit

YTD Balance of Trade62.3 % Y-o-Y change

Jan-July 2021: (RM3.8billion)
Trade Deficit[AUTHOR NAME]

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MSI WITH YOU
MoU with BIMAGE
On 8 July 2022, Malaysia Steel Institute hasorganised an online meeting with Bimage
Consulting to sign an MOU agreement. Themeeting was chaired by Mr Lim Keng Yow, Chief
Executive Officer of MSI and attended by Mr Ajith,Managing Director of Bimage Consulting and Mr
Donahue Chong, Chief Executive Officer of Bimage
Consulting. The meeting was witnessed by two
MSI’s staff. Next, MSI will collaborate with Bimage Consulting to promote IR4.0 related training programmes toiron and steel and construction industries as a whole to enhance their adoption of IR4.0.

Majlis Perasmian Program Semarak Ilmu @ MITI 2022
Program Semarak Ilmu @ MITI 2022 was held on
July 26, 2022 at Dewan Perdana MITI. This programis one of the initiatives of the reading
encouragement program at the level of the Ministry
and Agencies to foster a culture of reading practice.
The Opening Ceremony of this program wascompleted by YBhg. Datuk Lokman Hakim Ali,
Secretary General, MITI[AUTHOR NAME]

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Visit to EMI
On 26 July 2022, MSI visited Established Metal Industries (EMI) to monitor the progress of EMI Coil factory setup. The factory producing the narrow strip is estimated to be ready by Q4 2022.

MAJLIS SAMBUTAN JUBLI PERAK 25
TAHUN PTPTN
On 27 July 2022, MSI was invited toSambutan Jubli Perak 25 Tahun
Perbadanan Tabung Pendidikan Tinggi
Nasional (PTPTN). The ceremony that washeld at the MARTRADE Exhibition andConvention Centre, officiated by the PrimeMinister, Datuk Seri Ismail Sabri Yaakob
who also launched the PTPTN Education
Savings Club.

TURUN PADANG TO ULTIMATE MATERIAL
On 22 July 2022, MSI visitation to Ultimate Material Sdn Bhd located atKuantan, Pahang to view the scrap yard operation for iron and steel
sector. Iron and steel scrap comes in various form, size and grade,
whereby different grades are supplied to different furnaces
application.

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MSI BRIDGING GAPSYBTM OFFICE LAWATAN KERJA KE AGENSI MITI –Malaysia Steel Institute (MSI)
On 6 July 2022, the Senior Confidential Secretary to the Deputy
Minister of MITI Mrs. Lai Yin Yee had a working visit to the MITI
agency (MSI) together with officials. The purpose of the work
visit is to deepen the understanding of human resource
management, marketing and public relations, as well as thechallenges faced by the MITI agency.

UKM TGRS PRESENTATIONOn 7 July 2022, MSI participated as industry collaborator inproposal presentation to the Ministry of Higher Education(MoHE). The research, entitled Next Generation Water
Electrolysis for Green and Sustainable Hydrogen Production(NexGH2): Towards Net-Zero Carbon Steel and Iron Industry leadby Universiti Kebangsaaan Malaysia (UKM). The main objectivesof the project is to reduce the consumption of coal by usinghydrogen as alternative substitute in the steelmaking process andwill help to decouple carbon emission from the iron and steelindustry. This initiative is consistent with global ESG goals in reaching carbon neutrality by 2050.

APPLICATION FOR NEW HS CODE 2022 FOR IRON & STEEL INDUSTRYFirst of all, MSI would like to thank MISIF for providing complimentary seat to attend “Application for new
HS Code 2022 for Iron & Steel Industry”. This session provides better understanding of latest updates on
HS 2022 for the Iron & steel industry which was sharedby the Royal of CUSTOMS as follows:i)
Customs Tariff Code Classification & Its
General Interpretative Rulesii)
Awareness of HS 2022 changes in SECTION
XV Base Metal (SECTION NOTES andNATIONAL NOTES CHAP 72); andiii)
Customs ruling (@ Advance ruling), disputes& appeals.

[AUTHOR NAME]

5SEMINAR IR4.0 STEEL & BIM FOR CONSTRUCTION SECTOR

Malaysia Steel Institute (MSI), co-organised with BIMAGE Consulting (M) Sdn. Bhd. the “SEMINAR: IR4.0 Steeland BIM Based Construction Cloud for Construction Industry” on July 19, 2022, at the Hilton Hotel Kuala Lumpur.
The programme was officiated by Yang Berhormat Senator Datuk Lim Ban Hong, Deputy Minister, Ministry ofInternational Trade and Industry (MITI).
The Seminar is aimed to expose programmes to support the Industry4WRD policy, particularly in the areas ofRegulations, Skills & Talents and Technology by adopting the Building Information Modelling (BIM) in theconstruction industry.
The seminar included four sessions, an opening session followed by three technical sessions, whererepresentatives from CIDB Malaysia, CIDB E-Construct Services Sdn Bhd, AUTODESK, BIMAGE Consulting Group(BIMAGE) and Universiti Malaysia Pahang (UMP), MATTERPORT Inc, VRCollab, Lenovo Asia Pacific, UTNM
Resources Sdn Bhd and PLYTEC Group shared their experience and expertise in their respective areas supporting
moving towards Industry 4.0.
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MSI TRU
BRIEFING RMK12 BATCH 8On July 1st of 2022, the eighth batch of the RMK-12 IRON AND STEEL INDUSTRY TRAINING PROGRAMME EXTENSIVE has begun. This program had a total number of 28 participants. It was taught over a virtual platformover the course of 15 lessons by a qualified trainer.

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STEEL FACTS[AUTHOR NAME]

8EVENTS HIGHLIGHT[AUTHOR NAME]

9STEEL NEWS
1. How green steel made with electricity could clean up a dirty industry
Date: 28 June 2022
Source:https://www-technologyreviewcom.cdn.ampproject.org/c/s/www.technologyreview.com/2022/06/28/1055027/green-steelelectricity-boston-metal/amp/
When you climb up a set of stairs to look over Boston Metal’s newest project, it becomes clear justhow big a job it is to cut steel’s climate impact.
Industrial steelmaking spits out about two tons of carbon dioxide emissions for every ton of steel
produced—adding up to nearly 10% of such emissions worldwide. The global steel market is expected
to grow about 30% by 2050, the date by which some of the largest steelmakers have pledged to reachnet-zero emissions. Unless major changes come to the industry, and fast, that goal might be out ofreach.
Boston Metal’s new reactor, recently installed at its headquarters just north of Boston, is a significant
step on the company’s journey to going commercial. Since its founding in 2013, the startup has
developed a process to make green steel, working out the details in smaller vessels. The new reactor,
along with a coming fundraising round, represents the next leap for the company as it tries to scaleup.
If Boston Metal can indeed scale its clean production process and access enough renewable electricity
to run it, the company could help solve one of the world’s toughest challenges in controlling carbonemissions.
A new approach
Steel is used in everything from cars to buildings to wind turbines, but decarbonizing the industry isn’t
glamorous. “People don’t pay too much attention to the industrials,” says Tadeu Carneiro, Boston
Metal’s CEO. “It’s a very conservative industry, and it’s difficult to abate.”
Fossil fuels are essential to today’s steel production. Most steelmaking starts in a blast furnace, wherea coal-derived material called coke, which is almost pure carbon, reacts with iron ore, a mixture of ironoxides and other minerals. The reaction pulls out the oxygen, leaving behind liquid iron. The carbon
and oxygen are then released together as carbon dioxide.
Boston Metal’s solution is an entirely new approach, called molten oxide electrolysis (MOE). Insteadof using carbon to remove oxygen, the process relies on electricity, which runs through a cell filledwith a mixture of dissolved iron oxides along with other oxides and materials. The electricity heats thecell up to about 1,600 °C (nearly 3,000 °F), melting everything into a hot oxide soup.
In addition to heating things up, electricity drives the oxygen-removing chemical reactions. Molten
iron gathers at the bottom of the reactor, and oxygen gas is emitted instead of carbon dioxide. Because
the impurities largely stay out of the reaction, the MOE process can handle low-quality iron ore, which
could be a major benefit of the technology, Carneiro says.
[AUTHOR NAME]

102. China’s Steel Industry Sounds the Alarm Over Crisis Conditions
Date: 7 July 2022
Source: https://www.bloomberg.com/news/articles/2022-07-07/china-s-steel-industry-sounds-thealarm-over-crisis-conditions
China’s steel mills are sounding the alarm over crisis conditions in the industry as margins plunge
due to weak demand.
Other mills in both the northwest and southwest of the country have pledged to reduce output asthey wait on infrastructure spending to revive steel demand. Stockpiles have swollen way beyond
seasonal norms after China’s crackdown on its property sector and its Covid Zero policy curbed
construction activity. The steel industry’s purchasing managers’ index for June recorded its worst
reading in a decade last week.
Although stockpiles were finally being drawn down at the end of the month as China rolled backsome of its toughest virus restrictions, they’re still 23% higher than a year ago, according to thelatest survey from the China Iron & Steel Association. President Xi Jinping has called for an all-out
push on infrastructure to rescue the economy, but it’s unlikely that will fully make up for demandlost from the real-estate sector.
Cutting output, at least from last year’s levels, is likely to suit both industry and government, as
reduced supply will support prices as well as aiding Beijing’s mission to cap carbon emissions fromthe highly pollutive sector.
3. China’s Challenge with Iron Ore
Date: 11 July 2022
Source: https://www.institutionalinvestor.com/article/b1ysny0417gs5d/chinas-challenge-with-ironore
AT A GLANCE
China’s zero COVID policy and slowing economic growth could affect its demand for iron ore
Iron ore prices have been volatile since hitting a record in May 2021
Iron ore prices have remained volatile since hitting a record high in May 2021. With uncertainties
persisting on both the supply and demand side, price fluctuations look set to continue.
China’s Iron Ore Dependency
China is the world’s largest consumer of iron ore, and despite being the third largest producer, it still
imports around 80% of the iron ore it uses each year. The biggest producers of iron ore are Australia,
Brazil and China, which collectively account for around two-thirds of global output, with India, Russia,
Ukraine and Canada also significant producers, according to the U.S. Geological Survey Mineral
Commodity Summaries 2022.
China imported a total of 1.12 billion tons of iron ore in 2021, down slightly from 1.17 billion tons in2020, according to government data. The drop in demand was largely driven by lower steel productionin China, as the government placed constraints on the industry in a bid to reduce carbon emissions.
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Going forward, China’s demand for steel, and by extension iron ore, could be impacted by conflicting
factors. On the one hand, the country’s zero-COVID policy could lead to ongoing lockdowns,
particularly in the face of the highly contagious omicron variant, which would impact economic activity
and reduce demand. On the other hand, with data for March 2022 pointing to slowing economicgrowth, the government is set to introduce stimulus measures to boost the economy. The Communist
Party’s Politburo recently stressed the importance of meeting annual economic goals, and increasing
infrastructure construction to help boost growth. A rise in infrastructure construction would boost
demand for steel, and its raw ingredient, iron ore.
Over the medium term, China has set the goal of significantly increasing its iron ore self-sufficiency. In
the 2021-25 Raw Material Development Plan, it set out plans to increase domestic mining and raising
the use of scrap steel. Until this goal is achieved, China remains heavily dependent on imports, with
60% of shipments coming from Australia.
Price Volatility Drivers
Iron ore prices have been volatile since hitting a record level in May 2021, when they reached $237
per metric ton (MT) on the back of rising demand from China. In November 2021, they slumped below$100 per MT, before recovering to a seven-month high in March 2022.
On the supply side, prices had gained some support due to concerns about production. Australia has
seen a fall in its iron ore output due to labor shortages, partly as a result of Omicron outbreaks. Mining
giants BHP Group and Rio Tinto both posted lower first quarter output than expected, while Brazil’s
Vale posted a 6% decline, although it expects production to pick up going forward.
At the same time, the onset of war in Ukraine put further upward pressure on iron ore prices in late
February to early March 2022 due to its impact on exports from both Russia and Ukraine. Ukraine
accounted for 3% of global iron ore production in 2021, but exports have been disrupted by themilitary action. Meanwhile, western producers have also been seeking alternative suppliers amid
economic sanctions.
Despite these supporting factors, iron ore prices have continued to be volatile in recent weeks, withfluctuations partly driven by changing expectations for demand as China continues to pursue its zeroCOVID strategy.
The Portside and Seaborne Spread
Price volatility extends to the spread between China’s seaborne and portside iron ore market.
Seaborne iron ore has a lead time of one to two months and reflects future supply/demand, withprices quoted in U.S. dollars per dry metric ton. By contrast, portside iron ore has a shorter lead time,
typically of just a few days, meaning its price reflects the current supply/demand situation, while prices
are quoted in renminbi (RMB) per wet metric ton, with VAT and port fees included in the price.
The portside market has been growing in importance in recent years both for price discovery, as theportside market reflects domestic demand more closely, and direct RMB-denominated sales of landedcargoes by international companies. Another advantage is that trading of portside iron ore can bedone for smaller volumes and with less onerous financing arrangements, while the market tends tomove faster than the seaborne one, making it more responsive to changes in demand.

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The spread between the portside and seaborne market for iron ore can be volatile, due to factors
ranging from shipping times, to foreign exchange rates, to financing. In recent weeks the discount ofportside prices to seaborne ones has narrowed significantly, largely due to weaker than anticipateddemand for iron ore in China following COVID-19 lockdowns. The situation is a significant reversal ofmuch of 2021, when portside iron ore traded at a premium to seaborne, before a build-up of portsidestocks triggered the shift to a discountManaging Price Risk
CME Group has launched two new China portside iron ore futures contracts to help market
participants manage their exposure to landed iron ore cargo prices on-shore in China.
The Iron Ore China Portside Fines CNH fot Qingdao (Argus) futures and Iron Ore China Portside Fines
USD Seaborne Equivalent (Argus) futures are the first internationally traded derivatives linked toChina’s portside prices. The contracts help market participants manage their onshore iron ore pricerisk at Qingdao Port in China.
It is one tool to help participants along the supply chain manage what remains an uncertain situation.
With both the supply of iron ore and demand from China remaining uncertain, iron ore price volatility
could continue for at least several more months.

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ABOUT MSI
Malaysia Steel Institute (MSI) is an industry driven enterprise supported and funded by the Ministry of International Trade &Industry (MITI) on shared responsibility basis with the industry. The main objectives of MSI are to promote and develop thecompetitiveness, resilience and sustainability of the Malaysian Iron and steel industry; to provide advisory services and to carryout commission or promote the study of scientific, technology and economic aspects of iron and steel industry development in
Malaysia; and to promote iron and steel product standardization and utilization within Malaysia. For more information, please
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MALAYSIA STEEL INSTITUTE
Level 26, Menara MITI
No. 7, Jalan Sultan Haji Ahmad Shah
50480 Kuala Lumpur

ADVERTISEMENTFor Inquiries:
T: 03-6208 4657 E: syakirah@malaysiasteelinstitute.com[AUTHOR NAME]

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