Malaysian ministry seeks low-carbon steel path

A deputy minister from Malaysia’s Ministry of Trade and Industry (MITI) has stated that decarbonization must be a key agenda in the iron and steel industry, adding that blast furnace investment in his part of the world has led to “a race to the bottom” in terms of more capacity, much of it in high-emissions steelmaking.

The remarks were made by Y.B. Liew Chin Tong of MITI during a presentation at the 2025 Association of Southeast Asian Nations (ASEAN) Iron and Steel Forum, held in Kuala Lumpur, Malaysia, in late September.

In a five-page transcript of Liew’s remarks posted to the MITI website, the deputy minister refers to the steel industry in Malaysia as “a strategic sector that requires national attention.”

He expresses concern about global excess capacity, noting that Asian economies are expected to account for 58 percent of the new capacity, led by substantial increases in China and India.

In the ASEAN region, annual steelmaking capacity stands at 84.6 million metric tons currently but is forecasted to double to 169 million metric tons by 2035, driven by 57.7 million metric tons of additional blast furnace and 26.8 million metric tons of electric arc furnace (EAF) capacities, according to Liew.

Earlier this year, the Malaysia-based South East Asia Iron and Steel Institute (SEAISI) trade group expressed concerns about both the capacity growth and its high-emissions nature, and MITI seems to be adopting the same perspective.

Like SEAISI, Liew points to recycled-content EAF production as the lower emissions option for his nation of 35 million people and for the world overall. 

The recent blast furnace-heavy expansion vastly outpaces ASEAN’s steel demand growth and threatens industry sustainability, Liew says.

Referring to a recent national Independent Committee on the Iron and Steel Industry report, Liew says it shows the capacity utilization of the less carbon-intensive EAF sector in Malaysia is only around 40 percent, "which is not sustainable and alarming."

Malaysia has the potential to be a sizable buyer of recycled steel from the United States and Europe, and would be best poised to do so by raising its EAF mill capacity rate.

Liew lists several circumstances he says are shaping the current and future state of steelmaking, including more steel nationalism as exemplified by the United States government obtaining a “golden share” as part of the Nippon Steel acquisition of U.S. Steel Corp.

On the emissions front, the European Union’s carbon border adjustment mechanisms will have consequences for the global steel industry, according to Liew.

“This is the time for all of us, especially those in ASEAN, to race to the top, to adhere to the highest standards [and] create conditions for clean and green steel to be produced," Liew says.