YKGI To Ramp Up Production Of Steel Products By 53%

Friday, September 25, 2015

CEO Datuk Soh Thian Lai (picture) told The Malaysian Reserve the company plans to capitalise on the announcement in capturing a larger share of the PPCCSC market. (Pic by Muhd Amin Naharul/TMR)

YKGI Holdings Bhd is looking to ramp up its production of prepainted, painted or colour-coated steel coils (PPCCSC) by 80,000 tonnes or 53% per year to meet rising demand following the imposition of provisional anti-dumping duties for PPCCSC products imported from China and Vietnam.

CEO Datuk Soh Thian Lai told The Malaysian Reserve (TMR) the company plans to capitalise on the announcement in capturing a larger share of the PPCCSC market. YKGI is one of the main producers of PPCCSC and is the only company that is listed on the local exchange.

The expected increase will push YKGI’s annual production of PPCCSC to about 230,000 tonnes.

When asked on how this will impact YKGI financially, Soh, who is also the president of Malaysian Iron and Steel Industry Federation, declined to give any details but said it is still too early to tell.

Soh, however, said the new imposition of duties is positive on the industry as it will help to mitigate the negative effects of cheap steel products dumped into the country.

“We have been suffering from low capacity utilisation following weakening demand for locally sourced PPCCSC and we hope to enhance our production immediately by yearend,” he told TMR on Wednesday.

The Ministry of International Trade and Industry (MITI) had announced that it is imposing provisional anti-dumping duties ranging from 5.68% to 52.1% on imports of PPCCSC ,which will be effective not more than 120 days from the date of the Government Gazette. 

“The government of Malaysia has decided to impose a provisional measure, which shall be in the form of provisional anti-dumping duties guaranteed by a security equivalent to the amount of the dumping margin determined in the preliminary investigation,” MITI said in a statement.

On April 28, 2015, the government initiated an anti-dumping investigation based on a petition filed by FIW Steel Sdn Bhd on behalf of the domestic industry producing PPCCSC.

The petitioner alleged that imports of PPCCSC originating in or exported from China and Viet nam are being imported into Malaysia at a price lower than the selling price in the domestic market of the alleged countries.

The petitioner claimed that this is causing material injury to the domestic industry in Malaysia.

“The government has completed the preliminary investigation as provided under Section 23 of the Countervailing and Anti-Dumping Duties Act 1993 and found that there is sufficient evidence to continue with further investigation on the importation of PPCCSC from the alleged countries,” MITI said.

MITI said based on the findings of the investigation, a final determination will be made no later than Jan 23, 2016.

For the full year ended Dec 31, 2014 (FY14), YKGI posted a net loss of RM26.64 million agai nst a net profit of RM500,000 recorded in the same twelve months a year ago.

Its revenue dropped 4% to RM537.69 million from RM560.34 million due to depressed selling prices since the beginning of the year.

 

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