SteelAsia Manufacturing Corp. is looking to spend P80 billion within the next six years to increase the local supply of wire rods and sections and lessen the country’s dependence on imports.
SteelAsia Chairman and CEO Benjamin O. Yao said the investment is also part of the company’s efforts to revive
the country’s steel industry.
“We practically don’t have a steel industry in the Philippines except for the rebars being produced. Everything else is imported. Today, there is a good opportunity, there is a strong demand [for steel]because there is a market, there’s infrastructure, there’s opportunity for us to have our steel industry,” said Yao.
SteelAsia Vice President for Corporate Development Rafael Hidalgo said the first phase of the company’s six-year plan includes the building of integrated steel making and hot rolling facilities for products such as wire rods and sections.
Of the P80 billion in total investment, P25 billion will be used for the first phase, which includes putting up two wire-rod mills worth P7.5 billion each and one section mill worth P10 billion.
Hidalgo said one integrated wire-rod mill, which will be put up in Concepcion,Tarlac will have the capacity to produce 1.2 million metric tons per year. The mill is expected to be completed by 2020.
Another wire-rod mill will be built in Compostela, Cebu and will have the capacity to produce 800,000 metric tons per year.
Hidalgo said the section mill, which will be put up in Lemery, Batangas and is expected to be completed by 2020, will have the capacity to produce 500,000 tons per year.
“Sections are used for beams and sheet piles which are basically products for infrastructure. Wire rod, on the other hand, is for industrial. It is used to make knots, bolts, springs, welding rods, screws, wires, and mesh,” he said.
“Wire rods and sections are currently two products that are not produced in the Philippines. These kinds of products are the missing links to industrialization. Our country has such difficult time industrializing because the linkage between the steel industry is broken and it’s a very good time to revive it,” he added.
Hidalgo said local demand for wire rod alone is at 600,000 tons while demand for sections is at 700,000 tons.
“Eventually we want to be able to supply that because at present these are all imported,” he said.
SteelAsia did not disclose the details for phase two and three of its six-year expansion plan.