[ Malaya.com.ph ] August 31, 2009
BY IRMA ISIP
Global Steel Philippines Inc. said the worst is over for the steel industry and it is infusing $100 million for trade financing of raw materials to ramp up production.
Sangram Mohanty, vice president for corporate communications, said prices are going back up again which puts Global Steel at an advantage owing to its global presence.
He said that last year, steel companies cut down production by 60 percent and operated only 40 percent of their capacity.
Mohanty said steel prices are expected to go up further by December after firming up to $200 per metric ton from May to August this year.
Global Steel has presence in 30 countries, including Asia where recovery has started, according to Mohanty.
In the early part of the year, Global Steel was operating on orders only and on rotation after demand dropped in the last quarter of 2008.
Mohanty said none of its 1,100 workers were terminated but were asked on forced leave on no-production days.
The company is importing $108 million worth of raw materials in the form of slabs starting August till December this year
This will enable Global Steel to ramp up production of flat products to 60,000 tons per month starting October to December and 80,000 tons per month starting January next year
In September, production is estimated at 35,000 tons.
Mohanty said Global Steel will import 230,000 tons of slabs from India, Brazil and Venezuela.
Although Global Steel’s output is still 60 percent for export, Mohanty said it will be building its local market.
Slabs are converted into hot rolled coils then to cold rolled coils.
The company is committed to pursue its $1.6-billion investment to fully integrate operations from mining to manufacturing but this would depend on market conditions.
Global Steel, the country’s biggest domestic manufacturer and exporter of flat steel products, has an installed capacity of 1.2 million tons for hot rolled coils; 900,000 tons for cold rolled coils and 300,000 tons for hot rolled plates.