MISIF Trade Forum 2023 - Navigating Global Market Dynamics For A Sustainable Future In The Iron & Steel Industry

China finds itself at a pivotal juncture with a notable downturn in both production and consumption since 2020, while exports continue to rise. The country is undergoing structural shifts, particularly in the steel sector, where consumption is shifting from real estate to infrastructure and manufacturing. This reflects the ongoing challenges in the Chinese property market.

On a global scale, steel consumption remains relatively steady, despite China's substantial decline, owing to robust performances from India (the second-largest consumer) and Japan (the fourth-largest). Looking forward, the World Steel Association (WSA) anticipates a sluggish global steel demand, projecting a marginal increase of 1.7% in 2024.

The ASEAN region faces concerns of unsustainable capacities, as reported by SEAISI, predicting a potential influx of integrated megamills. If these plans materialize, over 71 tonnes of steel capacities could saturate the market by 2026, surpassing the demand or apparent steel consumption (ASC) in the region.

Examining Malaysia's industrial landscape in 2022, a stark contrast emerges. While segments like HM and PI have exceeded the global average and sustainable threshold for capacity utilization, other categories lag significantly below these benchmarks, recording levels below 51%. Notably, Malaysia's ASC struggles to keep pace with increasing overcapacity and the persistent challenge of low utilization rates.

In the pursuit of decarbonization, the immediate focus lies in leveraging renewable energy (RE) and enhancing energy efficiency (EE), deemed as the most accessible and cost-effective initial steps to reduce emissions. Subsequent steps involve transitioning to advanced technologies like electrification EAF, hydrogen-H2-DRI, CCS/CCU, and BECCS. The adoption of these technologies hinges on the nation's technological maturity and economic viability.