Posted on 01 Jan 2016
Megasteel: Safeguard Petition Merits Consideration
Megasteel Sdn Bhd has reiterated that its petition for Safeguard on Hot Rolled Coil (HRC) to curb the rampant imports of HRC at dumping prices merits consideration.
The company said this in reply to The Malaysian Iron and Steel Industry Federation's (Misif) allegation that its petition had no merit.
In a statement today, Megasteel said it had the right to seek trade remedy measures such as anti-dumping and safeguard duties against HRC imports which were causing serious injury to the local HRC industry.
The industry has two producers, Megasteel and Southern Steel Bhd, whose production are adversely affected by such imports.
It said the Ministry of International Trade and Industry (MITI) had gazetted the petition which was thus deemed to have fulfilled the necessary conditions and requirements including under the World Trade Organisation, and therefore, merits consideration.
The company reserved the right to take appropriate legal action against relevant parties should its interests be jeopardised, Megasteel said.
"Many countries have adopted safeguard measures against steel imports but we have not witnessed any trade wars erupting between countries as a result of those safeguard measures.
"Such scaremongering of trade wars and retaliation measures by Misif is highly regrettable," it said.
The safeguard measure, it added, would reduce the excessive importation of HRC and help save the country's foreign exchange and reduce the current deficit.
On Misif's contention that Megasteel's HRC prices were higher than the world average, the company clarified that the prices were guided by the price mechanism sanctioned by MITI and had never been sold above the price allowed under the mechanism.
The sale of HRC to the electronics, white goods and automotive sectors was also minimal and therefore, would not cause the escalation of inflation, it said.
Megasteel and local upstream producers shared the same objective to protect the long-term, sustainable development and interests of the Malaysian iron and steel industry, it said.
Hence, the existence of a strong upstream in iron and steelmaking would help to promote and develop the midstream and downstream industries, and contributes to the creation of indigenous capability and manufacturing skills.
It added the upstream producers made use of local inputs and added value to the entire manufacturing chain, and during times of steel shortages, it was essential to have a local supplier of steel to ensure that development and infrastructure projects were not affected, as had happened in 2008.
The company believes that MITI will evaluate the safeguard petition and make its decision in the best interests of the local HRC industry and the nation.
