World Scrap Congress: The Scene in ASEAN

The opening up of China’s economy in the past three decades has provided a boost to many of the countries making up the ASEAN (Association of South East Asian Nations) trading area, according to Tan Ah Yong.

Tan, Secretary General of SEAISI (the South East Asia Iron and Steel Institute), based in Malaysia, spoke at the 2010 World Scrap Congress in Shanghai in November. Malaysia is one of 10 member nations of ASEAN, along with Brunei, Cambodia, Indonesia, Laos, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

“When China opened up, ASEAN [nations] invested and benefitted early on,” Tan told attendees of the 2010 World Scrap Congress, held in Shanghai Nov. 11-12.

While China has been growing its GDP, in some cases, by more than 10 percent per year, nations such as Indonesia, Malaysia and Vietnam have been growing from 4.5 to 6.8 percent in the past three years.

Tan’s presentation focused on the steelmaking and scrap demand situation in the ASEAN region, where much of the steelmaking uses the scrap-intensive electric arc furnace (EAF) method.

SEAISI statistics indicate that ASEAN nations that imported 1.3 million tons of ferrous scrap in 1998 imported more than 9 million tons just a decade later in 2008.

Within that total, Vietnam is emerging as the largest importer (1.8 million tons in 2009), vying with Malaysia (2.2 million tons in 2008 but just 1.7 million tons in 2009). Indonesia and Thailand also import from 1.3 to 2.6 million tons of ferrous scrap per year, depending on economic conditions and scrap-versus-scrap alternatives pricing.

Tan said he sees increased opportunities for ferrous scrap importers to serve the ASEAN region, especially in Vietnam, Indonesia and the Philippines. As those economies develop, their per-capita steel consumption figures are just beginning to catch up with those in Singapore, Malaysia and Thailand.

The World Scrap Congress, organized by Singapore-based Terrapinn, was Nov. 11-12 at the Grand Melia Hotel in Shanghai.