Posted on 31 Dec 2015
Megasteel was responding to allegations made by the Malaysian Iron & Steel Industry Federation (Misif) claiming its petition to curb the rampant imports of HRC at dumping prices has no merit.
It said it had the right to seek remedy measures such as anti-dumping and safeguard duties against HRC imports, which are “causing serious injury” to the industry, namely to Megasteel and Southern Steel Bhd, whose production have been adversely affected by such imports.
It said the International Trade & Industry (Miti) Ministry had gazetted Megasteel’s petition for safeguard, which means the company has fulfilled the necessary conditions and requirements including under the World Trade Organisation (WTO) and therefore, merits consideration.
“Misif’s threat to take legal action on this matter only serves to undermine the Malaysian authorities’ jurisdiction even before any ruling can be made. On this note, Misif’s call to foreign steel players to file their case to WTO against Megasteel’s petition not only questions Miti’s authority and the ministry’s right to accept and decide on such petitions but most alarmingly, raises doubts on Misif’s agenda in exhorting foreign steel players to take action against local steelmakers which can be seen as an act of subversion towards our national interests and financial stability,” it said.
It also reserves the right to take appropriate legal action against relevant parties should its interests be jeopardised.
To recap, Miti had initiated a safeguard investigation on imports of HRC following a petition lodged by Megasteel, the country’s largest HRC producer.
In its petition, Megasteel had requested the Government to impose safeguard duties on the imports of HRC at the rate of 40% on top of the existing 15% import duties on HRC, with the rate to be gradually reduced over a four-year period.
“For the record, Misif’s members themselves have also filed trade remedy petitions; one example being FIW Steel Sdn Bhd’s petition against imports of pre-painted/painted/colour coated steel coils from China and Vietnam, with Miti having agreed to impose provisional duties of 52.1% against such imports from China, and 5.68% to 16.45% against Vietnam,” said Megasteel.
Also, many countries had adopted safeguard measures against steel imports without inciting trade wars between countries as a result of those measures.
“Such scaremongering of trade wars and retaliation measures by Misif is highly regrettable,” Megasteel added.
Although Misif has called for the Government to reject Megasteel’s petition, several association’s members who are downstream users of HRC support the safeguard petition, said Megasteel.
“The safeguard measure will reduce the excessive importation of HRC and help to save our foreign exchange and reduce the current deficit,” it said.
It also clarified that its prices were guided by the price mechanism sanctioned by Miti and had never sold above the price allowed under the mechanism.
This is in reply to Misif’s claim that Megasteel’s HRC prices were higher than the world average.
It said the sale of HRC to the electronics, white goods and automotive sectors was minimal and therefore, would not cause the escalation of inflation as alleged by Misif.
“Similar to the safeguard granted for steel plates, there will be certain exclusions (from safeguard action), and we will be discussing with the authorities to allow exclusions especially for export oriented industries so as not to affect their competitiveness in the export markets,” said Megasteel.
