REBARSTEEL WIRE ROD

RM2,908

RM3,129

RM3,341

June 2022

BILLETSCRAPIRON ORE

RM1,881

RM624

Trade Performance
Malaysia’s Trade Performance, January-June 2022
Malaysia’s Iron and Steel total trade value in June 2022 grew by 23.0 percent to RM6.2 billion compared toRM5.1 billion in June 2021 for the same period.

Trade deficit also reduced to RM976.5 million from RM1.1billion for the same comparison period.
Malaysia’s iron & steel export in June 2022 increased by 32.9 percent to RM2.6 billion from RM2.0 billion in June
2021. Three main export destinations in June 2022 were Singapore, Indonesia and Thailand, accounting for 13.4,
11.0 and 8.8 percent of the total export value respectively.
Malaysia’s iron & steel import in June 2022 rose by 16.6 percent from 3.1 billion in June 2021 to 3.6 billion inJune 2022. Imports from China, Japan and Korea accounted for the top three (3) spots representing 31.0, 14.0
and 11.5 percent of the total import value, respectively.
From January to June 2022, the total trade value of the Iron and Steel products stood at RM35.6 billion in 2022
compared to RM28.8 billion in the same period in 2021, an increase by 23.4 percent. Further, the trade balance
improved from a trade deficit of RM3.1 billion in 2021 to a trade deficit of RM1.2 billion in 2022 during the same
period of comparison.

Malaysia Trade Performance of Iron & Steel Industry
June 2022: RM6.2billion

Month Trade Value
23.0 % M-o-M change

June 2021: RM5.1billion

June 2022: (RM976.5million)
Trade Deficit

Month Balance of Trade12.3 % M-o-M change

June 2021: (RM1.1billion)
Trade Deficit
Month Export
June 2022: RM2.6billion
32.9 % M-o-M change

June 2021: RM2.0billion

Month Import
June 2022: RM3.6billion
16.6 % M-o-M change

June 2021: RM3.1billion

YTD Trade Value
Jan-June 2022: RM35.6billion
23.4 % Y-o-Y change

Jan-June 2021: RM28.8billion

Jan-June 2022: (RM1.2billion)
Trade Deficit
Jan-June 2021: (RM3.1billion)
Trade Deficit

YTD Balance of Trade59.9 % Y-o-Y change[AUTHOR NAME]

2MSI WITH YOU
MSI 9th ANNUAL GENERAL MEETING (AGM)
On the 23rd June 2022, Malaysia Steel Institute hasorganised the 9th Annual General Meeting (AGM) via
hybrid (physical and online) at Cempaka Meeting Room,MITI Tower. The AGM was chaired by YBhg. Dato’ Sri
Norazman Ayob, Chairman of MSI. MSI presented thedeliverable and activities for 2021 and 2022.

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MSI BRIDGING GAPSLAUNCHING OF MISIF 14TH REPORT ON STATUS AND OUTLOOK OF THE MALAYSIAN IRON ANDSTEEL INDUSTRY
The Malaysian Iron and Steel Industry Federation (“MISIF”)
has launched the 14th edition of the flagship report on 22June 2022. The launching of the report entitled “The 14thReport on Status and Outlook of the Malaysian Iron andSteel Industry 2022/2023” (“14th MISIF Report”) waspresided
by theevent’sGuest-of-Honour YBhg. Datuk Lokman Hakim Ali, Secretary
General of the Ministry of International Trade and Industry(“MITI”), Dato’ Lim Hong Thye, President of MISIF, Tan Sri Dato’
Soh Thian Lai, MISIF Immediate Past President and En. Roshan
Abdullah, MISIF Deputy President I and 14th Report Editorial
Committee Chairman.

HASILWAN ON ESG FOR IRON AND STEEL

On 30 June 2022, Hasilwan (M) Sdn Bhd visited to MSI todiscuss on the possible collaboration in renewable energy,energy efficiency and solar power system to be integrated inthe iron & steel industries to reduce the cost of energy andcarbon emission. It is also part of the initiative to achieve theGHG emissions intensity (by GDP) by 2030.

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MSI TRU
BRIEFING BATCH 6
MSI started RMK-12 IRON AND STEEL INDUSTRY TRAINING
PROGRAMME – EXTENSIVE BATCH 6 on 7 June 2022. A
total of 16 participants from 3 steel companies haveparticipated in this programme. The programmes targets
to train local workers to upgrade their skills to work iniron and steel industry, reduce the dependence on
expatriate/foreign workers and eventually reduce outflowof Malaysian currencies due to foreign employment.

BRIEFING BATCH 7
MSI Commenced batch 7 of RMK-12 IRON AND STEEL
INDUSTRY TRAINING PROGRAMME – EXTENSIVE Batch 7 on
20 June 2022. A total of 14 participants have participated inthis programme , the programme was conduct via virtual
platform with 15 classes to be delivered by experience
trainer.

SESI PEMBENTANGAN PROGRAM LATIHAN OLEH SYARIKAT
GREEN PACKET ACADEMY SDN BHD
Green Packet Academy Sdn Bhd presented their capabilities and experience in conducting trained and placed
programme with MITI and Agencies and they are interested to collaborate with MITI Agencies to conduct training
programme for the industry.

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5STEEL FACTS[AUTHOR NAME]

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EVENTS HIGHLIGHT[AUTHOR NAME]

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STEEL NEWS1. Not Just a Fence: The Story of a Stainless Steel Status Symbol
Date: 10 June 2022
Source:https://www-nytimes-com.cdn.ampproject.org/c/s/www.nytimes.com/2022/06/10/realestate/nyc-asian-fence-status.amp.html
On the residential streets of Flushing, Queens, and Sunset Park, Brooklyn, steel fences line almost
every other house. They’re silver, sometimes embellished with gold, and they’re in striking contrast to
the modest brick and vinyl-clad houses that they encircle, like a diamond necklace worn atop an old
white T-shirt.
“If you have money to spare, you should always get the better option,” said Dilip Banerjee, gesturing
toward his neighbors’ wrought iron fences and basking in the shine of his own steel fence, handrails,
door and awning that cost him about $2,800 to add to his unassuming two-story house in Flushing.
Like the white picket fence, long a symbol of the so-called American dream, the stainless steel fence
embodies a similar sense of making it. But the steel fence is not muted or uniform; it twists and turns
to the taste of the maker, personalized with various ornaments, including lotus flowers, “om” symbols
and geometric patterns. At night, street lamps and car headlights exaggerate the glimmer of stainlesssteel that does not, cannot disappear into the darkness like wrought iron. Whereas some people might
be turned off by the flashiness, standing out is exactly its point — the stainless steel fence is an
undeniable signal that the homeowner has arrived.
“It’s certainly a mark of middle class arrivals, especially for folks for whom this is their first home,” said
Thomas Campanella, a historian of city planning and the urban built environment at Cornell University.
“There is a status element to the stainless steel.”
The rise of these fences — commonly found on single-family houses but also surrounding restaurants,churches, doctors’ offices and more — parallels the growth of Asian Americans in New York. Last year,
the city’s Office of Immigrant Affairs reported that Asians and Pacific Islanders are the city’s fastest
growing racial group, increasing primarily by a surge in immigration. In 2010, there were more than
750,000 Asian and Pacific Islander immigrants in New York, and by 2019, that number grew to nearly
845,000. The city also found that more than half of those immigrants lived in Queens. Correspondingly,
Mr. Campanella estimates that stainless steel fences started to take off in New York during the sametime frame.
When his Hispanic neighbors moved and sold their houses to Chinese buyers, the fences started tospread, said Garibaldi Lind, a Puerto Rican resident who has lived in Sunset Park for decades. “There’stwo down there,” he said, gesturing down 51st Street. “Up here, there’s three more.”
But other homeowners have also embraced the style of fence. “Throughout Queens Village andRichmond Hill, if you see a fence like this, it’s typically a West Indian household,” said FaridaGulmohamad, a Guyanese real estate agent.
“It is our status symbol,” she added.
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They’re not to everyone’s liking. “I’m not a fan myself. They’re unavoidable, but they’re a strange thing
where they’re too shiny or they call too much attention to themselves,” said Rafael Herrin-Ferri, thephotographer behind the book “All the Queens Houses.” “They have a very tawdry quality about them.
There’s a lot of tawdry, cheap stuff in Queens, but they don’t blend or complement any of the otherstuff.”Still, for all their fanciness and gaudiness, the fences are also practical, requiring low maintenancecompared to iron fences with peeling paint. Newly renovated houses for sale are dressed up from headto toe (or more aptly, awning to gate) in glittering steel.
Priya Kandhai, a real estate agent in Queens who frequently has listings in the Ozone Park and Jamaicaneighborhoods, said, “South Asians and East Asians seem to gravitate more toward stainless steel
because it looks nicer.”
She said when she shows her clients houses with steel fencing and awnings, they feel that the house ismore valuable and modern, similar to a kitchen having a stainless steel fridge instead of a white plasticone.
2. Steel prices tumbling back to levels before the war in Ukraine
Very quickly the steel market has reverted back to where it was before the war in Ukraine. The big
question now is not whether prices fall, but how fast and where the bottom might be.
Chatter in the market suggests some wonder if prices will fall back to or below $1,000/ton, roughly
where they were just after Russian forces launched their full-scale invasion.
“My bigger concern is where does it stop? I didn’t think it was going to stop until—Abracadabra!—there was a war. Now I can’t think of a single thing that would stop it from sliding besides the mills
saying, ‘Ok, we’re going to throttle back,’” one service center executive said.
A second service center executive agreed. “I hate talking about lower prices because I have inventory,and I want prices to be higher,” he said. “But I think we are fast returning to the path we were on priorto Mr. Putin’s invasion.”
A BRIEF HISTORY OF STEEL PRICESThe prospect of hot-rolled coil (HRC) at $1,000/ton seemed remote in mid-April, when prices nearly hit$1,500/ton, according to our pricing tool. Also, remember it was only in September 2021 when prices
reached nearly $1,955/ton, but the climb to last September’s record high was a long slog compared tothe unprecedented price spike we saw in March 2022, when HRC rose $435/per ton over 31 days.
I’ve been writing about steel and metals since 2007. SMU’s numbers go back to 2007. There isanalogue to what we saw in March. It was the biggest price jump steel has seen in the last 15 years—
perhaps ever.
But HRC pricing at or below $1,000/ton is not hard to imagine now. New capacity is ramping up. Scrap
prices have fallen in recent months. Now concerns are mounting that inflation—and the higher interest[AUTHOR NAME]

9rates deployed to combat it—could tip the broader economy into recession.
Knowing why these gyrations happened is cold comfort if you’re bringing in material now that wasordered a month ago, when spot prices were significantly higher.
“We were making a slim margin on hot-rolled and a decent margin on cold-rolled and coated. Now
we’re losing money on hot-rolled and making a slim margin on cold-rolled and coated,” a service
center executive recently told Steel Market Update.
How many others are in the same boat?

Figure 1. The short lead times for sheet metal have put the mills in a position where they are open tonegotiating lower prices. (HRC prices are the blue bars, and lead times are the gray bars.)
OUR LATEST SURVEY RESULTS
Given such comments, it’s maybe not surprising that SMU’s latest survey results are the most bearish
we’ve seen since the beginning of the war. HRC lead times are down (see Figure 1). (You can create thischart, and others like it, with our interactive pricing tool. You must be an SMU member. Log in andvisit: www.steelmarketupdate.com/dynamic-pricing-graph/interactive-pricing-tool-members.)
A roughly four-week lead time for HRC is relatively standard by most historical comparisons. But whilelead times are back to normal, prices still are very elevated compared to past norms. If you look backto August 2019 for example, before the pandemic distorted markets, lead times were roughly where[AUTHOR NAME]

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they are now, but HRC prices were $585/ton.
With lead times short, more mills are willing to negotiate lower prices. Survey respondents tell us
nearly 90% of domestic mills are willing to consider cutting HRC prices to attract new orders. That’s asharp turn of events from March, when almost all mills were insisting on higher prices (see Figure 2).
This isn’t happening in a vacuum. More and more service centers and manufacturers tell us they arelooking to cut inventories—and that trend has accelerated in recent weeks (see Figure 3).
And it’s not just mills that are lowering prices. So too are service centers. That’s another sharp reversalof the trends we saw in March and April, when service centers, like mills, were aggressively raising
prices.
Similar reports are evident elsewhere. More people report that they are on the sidelines. There’s anincrease in the number of people pessimistic about their future prospects. But you get the picture.
We’re no longer in the seller’s market that characterized March and much of April. Instead, we’re backto the buyer’s market that we had at the beginning of the year, before the war temporarily sparked
concerns about the availability of key raw materials such as pig iron.
WHERE DO WE GO FROM HERE?
The results of our latest survey indicate that people continue to expect prices to go down, at least in
the short term (see Figure 4). Will they recover in the fourth quarter?
First the bear case: I don’t like to talk about the summer of 2008. I don’t think comparisons to that
period should be made as lightly as they sometimes are. But I’d be remiss if I didn’t acknowledge thatsome market participants fear that there are too many parallels for comfort between June 2008 andJune 2022.
Some recall mills insisting then that everything was fine. That demand was good, and that backlogs
from the various markets they served was good—right up until those backlogs vanished almostovernight. And they hear echoes in public comments from steel industry executives that are eerilyfamiliar to what was being said in 2008.

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Figure 2. In March steel mills insisted on higher steel prices. As of June, they are a bit more flexible insteel price discussions.
I’m still not ready to go all in on the ’08 parallels. Prices in Asia appear to be stabilizing, and importoffers for HRC aren’t very competitive given how fast domestic prices are falling. The discrepancies
between import and domestic cold-rolled and coated prices are larger. But there, too, ourunderstanding is that the gap is closing quickly.
“If you’re a buyer, you’re like, ‘Wait a minute, why am I going to buy import (HRC) right now? The
domestic price is heading to $50/cwt. I’m not sure it’s going to stop when it gets to $50. So what is agood import price right now?’” one mill executive told me.
Recall too that the U.S. tends to both overshoot and undershoot the global market. We dropped below
Asian HRC prices in the summer of 2020. Remember $440/ton, anyone? And then it was nowhere butup for the next two years.
I also think back to what a veteran steel industry analyst once told me: “Whenever everyone throws inthe towel on the steel industry is usually when it comes roaring back.”
STEEL MARKET UPDATE EVENTS
SMU’s Steel Summit, the biggest annual steel gathering of its kind in North America, is happening Aug.
22-24 in Atlanta at the Georgia International Convention Center. I’ll be there. We anticipate roughly
1,200 decision-makers from the sheet and plate industries to attend as well. Some nearby hotels
already are selling out.
If you register, you’ll have access to our discounted room blocks. You can do that here.
As I said last month, if you’re on the fence about going, think about it this way: You could plan a halfdozen trips to see customers, or you could see them all at once in Atlanta. The logistics are hard tobeat. You can take a tram from the airport to the conference and the hotels around it. You can be in[AUTHOR NAME]

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and out without having to worry about renting a car or navigating traffic.
For more information about SMU in general or to sign up for a free trial subscription, email
info@steelmarketupdate.com.

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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 inMalaysia; and to promote iron and steel product standardization and utilization within Malaysia. For more information, please
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50480 Kuala LumpurADVERTISEMENT[AUTHOR NAME]

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