Posted on 26 Jan 2026
Malaysia must act decisively to defend its steel industry as global evidence mounts that unfair pricing practices are distorting international markets and undermining domestic producers.
Mycron Steel Bhd executive chairman Tunku Datuk Yaacob Khyra said there is clear international consensus that pricing practices particularly in Vietnam and South Korea have contributed to market distortion.
Investigations by the United States, the European Union, Mexico, India and Canada have all concluded that Vietnamese steel products were sold at dumped prices.
When viewed in the context of global enforcement trends, he said the use of trade remedies is not "protectionism" but a standard and widely accepted mechanism to ensure the survival of domestic industries.
Malaysia must not be left exposed, Tunku Yaacob, who is also director of Mycron Steel CRC Sdn Bhd, told Business Times in an interview.
The steel industry contributed RM26.4 billion to national gross domestic product in 2023 and supports about 278,000 jobs across the value chain, he noted.
Allowing continued erosion of domestic production capacity would weaken industrial resilience, threaten employment and compromise Malaysia's long-term economic security, he added.
Here are the questions and answers.
Question: From your perspective, what are the most significant challenges threatening the survival and long-term viability of the Malaysian steel industry today?
Answer: The most immediate existential threat is the surge of dumped imports. This view is not ours alone. Global expert groups like CRU, Fitch and Oxford Economics have all warned of global overcapacity and subsidy-led dumping, particularly from China, Vietnam and Korea.
Structural oversupply from exporting nations and the rise of protectionism is flooding our regional market, driving prices below sustainable levels and eroding the viability of domestic producers.
For example, Korea, Japan, China and Vietnam are already exporting significant volumes of steel into the global market. At the same time, countries such as the United States and Mexico are intensifying protectionist measures to shield their domestic steel industries.
As a result, displaced steel exports are increasingly being diverted into more open and less protected markets, particularly within the Asean region, leading to a surge of import pressure and heightened risk of market flooding.
Without immediate correction, Malaysia faces the risk of irreversible deindustrialisation in the flat steel sector, which is a national economic security issue as the country will be highly dependent on imported steel.
Q: The government recently unveiled the Steel Industry Roadmap 2035 and passed the Countervailing and Anti-Dumping Duties (Amendment) Bill 2025. What is Mycron Steel CRC Sdn Bhd's assessment of these national plans?
A: Mycron Steel CRC lauds the government's efforts. We view the policy intentas highly positive. The roadmap fairly identifies higher domestic capacity utilisation as a national priority and reaffirms the need for fair, rules-based competition.
Similarly, the 2025 Amendment Bill modernises our trade laws and introduces the TRIMA system for digital submissions. However, effective protection of the domestic industry ultimately depends on the enforcement of these laws by the responsible authorities.
This includes the ability to anticipate trade diversion risks and to benchmark Malaysia's responses against the measures adopted by other jurisdictions to safeguard their domestic steel industries.
The framework needs to be paired with strong implementation in order not to undermine the government's goal of strengthening the industry.
Q: There are growing concerns that Malaysia is becoming a "dumping ground" due to global trade diversion. How serious is this threat, and are there other leakages impacting the industry?
A: The threat is severe and comes from two directions. First, we are facing massive trade diversion.
The United States has imposed 50 per cent tariffs on steel imports under Section 232, explicitly targeting countries like Vietnam and South Korea. South Korea, which has an estimated 72 million tonnes of capacity and significant idle volume, is forced to divert that excess elsewhere.
Malaysia's relatively open regime makes it a prime destination for this diversion. We see this in the data: Korea's share of Malaysia's cold-rolled coil imports surged from 30 per cent in 2020 to 46 per cent in 2024.
This confirms we are absorbing volumes displaced or rejected by other nations. The resulting import surge has depressed prices to below sustainable levels for local producers, eroding domestic manufacturers' market share and leading to persistently low-capacity utilisation.
However, beyond just declared imports, there is a massive damage from steel being smuggled into the country. Every coil that enters under a false HS code, smuggling or misdeclaration to evade duties represents a direct loss of tax revenue.
We are effectively subsidising foreign smugglers while penalising compliant local manufacturers. If these leakages are not plugged, the country continues to bleed revenue that should be funding national development, while legitimate businesses are pushed to the brink. Action must be taken before this damage becomes irreversible.
Recent enforcement actions in 2025 driven by multi-agency crackdowns indicate a significant scale of illegal activity within the steel sector.
Ops Padu 1 in January 2025 and Ops Padu 2.0 in July 2025, led by the Royal Malaysia Police (PDRM) and the Construction Industry Development Board (CIDB), collectively seized over RM209 million worth of non-compliant steel products intended for the local construction industry.
Additionally, Ops Metal, launched in July 2025 by the Malaysian Anti-Corruption Commission, revealed a massive leakage in the export market, where syndicates smuggling scrap metal out of the country caused an estimated RM950 million loss in tax revenue over six years.
These figures collectively underscore the magnitude of both illegal imports of uncertified materials and the evasion of export duties affecting the Malaysian steel industry.
Q: As a Malaysian-owned entity, why is Mycron Steel CRC's survival critical to the national interest compared to relying on cheaper imports?
A: Mycron Steel CRC is effectively Malaysia's last standing Malaysian-owned flat steel manufacturer. In the last 10 years alone, we have seen the closure of three major domestic flat steel companies.
When these companies fold, we lose national sovereignty over our supply chain. Furthermore, unlike foreign exporters who do not contribute to our fiscal system, we pay corporate taxes and provide local employment.
We also prevent the outflow of foreign exchange. Malaysian manufacturers face a significant cost disadvantage due to high electricity and natural gas prices compared to many competing countries in the region.
These higher energy costs directly increase production expenses, reduce competitiveness, and further strain the sustainability of local steel manufacturers.
Crucially, even though we are not obliged to, Mycron Steel CRC is a key proponent of the government's push for minimum living wage. About 80 per cent of our Malaysian workforce currently earns above the RM3,100 per month.
However, these jobs will be at risk if the local steel industry fails. We can only continue to pay higher wages if the business remains economically sustainable. If the industry is no longer sustainable, we will not be able to sustain these wage levels or protect jobs.
Q: Countries like the US, EU, and India are taking strong measures against steel from Vietnam and Korea. Why does Malaysia's stance differ, and what are the consequences?
A: The international consensus is that Vietnam and Korea's pricing practices distort markets. Investigations by the US, EU, Mexico, India and Canada have all found Vietnamese steel products sold at dumped prices.
If you see the global pattern of enforcement, it is clear that enforcing trade remedies is not "protectionism" but a standard global practice to ensure survival.
Q: Looking forward, what is needed to ensure the long-term health of the sector, and how do you respond to concerns that stricter measures might breach World Trade Organisation obligations?
A: The WTO's Anti-Dumping Agreements clearly permit members to impose duties when dumping causes material injury. Major economies use these rules to defend their industries, and Malaysia must do the same.
The EU has extended its safeguard measuresuntil June 2026, maintaining a 25 per cent tariff on imports exceeding quotas.
In October 2025, the European Commission has also proposed major reform of its steel import safeguards, suggesting cuts in tariff-free quotas by about 47 per cent and imposing a steep 50 per cent ad valorem duty on any volumes beyond the new threshold.
India recently introduced the "Domestically Manufactured Iron and Steel Products Policy 2025", a five-year policy requiring government tenders to prioritise local steel. They understand that national sovereignty over supply chains is non-negotiable.
India also imposed a 12 per cent temporary safeguard duty on flat steel products, including from Vietnam, in March 2025.
Vietnam itself announced anti-dumping duties of 19.38 per cent to 27.83 per cent on imports from China in February 2025 to protect its own industry. Also, South Korea tightened its regulations in March 2025 to stop transshipment loopholes and is imposing up to 34.1 per cent duties on Chinese steel.
We must preserve the steel industry, which contributed RM26.4 billion to GDP in 2023 and supports 278,000 jobs. It is important that we prevent the erosion of our national industrial capacity.
Source:The Star
