SEAISI CONF: Japan official urges more talk, less trade action
Engaging with trade partners through bilateral dialogue rather than using trade remedies is important for the sustainable development of the steel industry in Southeast Asia, a senior steel executive from Japan said.
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Hiroshi Tomono, chairman of the Japan Iron & Steel Federation (JISF) said steps such as anti-dumping duties, countervailing duties, and safeguards make domestic mills uncompetitive in the long run, eventually harming domestic industries.
Trade friction can also be minimised by closely engaging with trading partner countries, he said, citing the use of such engagement by Japan. Japan was involved in 20 cases of anti-dumping investigations between 2001 and 2013, against China’s 80 and South Korea’s 43.
Tomono, who is also vice-chairman of the world’s third-largest steelmaker, Nippon Steel & Sumitomo Metal Corp (NSSMC), was speaking at a conference held by the Southeast Asia Iron and Steel Institute in Kuala Lumpur.
The Assn of South East Asia Nations (Asean) region is one of the world’s few growth frontiers, where steel demand grows year after year. Increasing population is one of the factors backing the growth, with steady economic growth foreseen in the medium and long term, he said.
There is still significant potential for further growth of the Asean steel industry, Tomono said.
To make existing steel mills more competitive, differentiating domestic steel products from imports, rather than “fighting an exhausting price war” against imported steel and improving cost competitiveness are key, he said.
As industrialisation advances, apparent steel consumption starts rising rapidly once this figure passes 100 per kg per capita and Asean steel demand is about to enter this phase, he said.
There will be structural changes in demand over the longer term. Long products for construction are the primary component of demand in the initial stage of economic growth, but as industrialisation progresses, sheets and coils for manufacturing take a greater share, replacing long products, he said.
As demand for high-end steel continues to grow, establishing production infrastructure for high-end steel is important, such as through building integrated steel mills through joint-ventures or establishing a chain of cross-border production within the Asean region , he said.