Posted on 14 Nov 2022
Southeast Asian steel mills will ultimately need to assess their competitiveness before they adopt carbon-neutral steelmaking technologies, Kallanish notes. The prospect of ASEAN mills adopting these technologies were discussed at a South East Asia Iron & Steel Institute (SEAISI) conference.
Green steel will be around 30-40% more expensive, according to Yeoh Wee Jin, secretary general of SEAISI. "Are we ready to pay for it?" he asked delegates. The ASEAN steel industry is not as advanced as its counterparts in Europe and the USA. The region is susceptible to low-priced imports which will suppress industry investment in the future, he observed.
SEAISI, whose seven member countries are Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, aims to create awareness of decarbonisation and conclude an action plan on certain pathways which SEAISI members can adopt to achieve this. There is also the issue of a carbon tax, which so far only Singapore has committed to adopting, and SEAISI hopes to highlight the carbon tax differences across borders.
Meanwhile, ASEAN steel industry members under the auspices of the ASEAN Iron & Steel Council (AISC) discussed last weekend the issue of foreign investors which are planning to invest in blast furnaces in the region. “The regional governments have started to push for carbon-neutral policies and yet these projects are coming into the region,” an insider tells Kallanish.
Industry firms in the various member countries have highlighted the serious over-capacities in steelmaking to their respective governments and now plan to inform them about the high CO2 emissions of blast furnace projects.
The announced steel investment projects until 2030 for the four main ASEAN countries amount to around 46 million tonnes/year and 90% of the new expansion projects are backed by Chinese investors, according to Dr Karel Eloot, senior partner at McKinsey. This comprises 14.9mt in Malaysia, 8.2mt in Indonesia, 7.5mt in Vietnam and 14.9mt in the Philippines.
ASEAN steel mills have to identify low-CO2 steel technology opportunities that are feasible for them, Eloot told delegates. This includes improving energy efficiencies, adopting green energy sources and implementing technology changes to achieve longer-term decarbonisation targets.
Source:Kallanish
