DTI scored for flip-flopping policy on steelmaking technology

SteelAsia Manufacturing Corp., the country’s largest rebar manufacturer with ambitions for an integrated steel production, has criticized the Department of Trade and Industry (DTI) for seemingly flip-flopping in its policy on steelmaking technologies.

Steel Asia CEO and Chairman Benjamin O. Yao said this amid a recent policy pronouncement of the government agency that it was considering all steelmaking technologies including induction furnace, (IF) which contradicts its own earlier statement against the IF technology on environment and quality issues.

“We hope DTI to be more pro-active in setting policies for environment-friendly steelmaking technologies. We expect the government to be firm because if China has banned IF then I don’t think we should be wasting time talking about this,” said the industrialist whose steel manufacturing business has been in operation for more than 50 years.

IF technology has been banned in other countries such as China as such technology produces substandard steel and are one of the main source of pollution in their host communities. Harmful elements of phosphorus and sulfur from liquid steel are present in varying amounts in the scrap iron and steel raw material, which poses a danger to the environment due to the “hit or miss” operation of every heat or batch of steel produced.

As a result, the ASEAN Iron and Steel Council (AISC) has issued a statement of concern over the moving of obsolete induction furnace facilities from China to ASEAN.

AISC has called on ASEAN member countries to impose a similar ban, raising concern that “ASEAN is becoming a dumping ground for these obsolete and outdated machinery and equipment.”

The AISC also issued a statement, which was presented during the ASEAN Senior Economic Officials Meeting in Singapore, stating that an estimated 600 induction furnace producers in China with a combined capacity of 120 million tons were shuttered following the IF ban.

Already, the Board of Investments of the DTI had denied the application for registration of Chinese firm Sanjia Steel Corporation to invest ₱800 million for the production of reinforcing steel bars (rebars) using coreless electric furnace smelting technology because it will employ obsolete and pollution-causing technologies.

Yao further expressed hope that the agency’s stand is not about making “everybody happy because we won’t stand against cheap and substandard steel.”

But recently, the DTI said it was considering all steelmaking technologies, including IF. This made Yao to comment that it now comes down whether DTI it is serious or not in bringing IF. He also said that consumers especially those in the provinces do not really know that they rebars they are buying are substandard or not.

But he cited President Duterte for making a strong stand in protecting the local industry. They are also requesting the President to appoint a steel czar.

Raffy Hidalgo, SteelAsia vice president of business development, said there are 8 steel companies engaged in IF technology with estimated capacity of 1 million metric tons of steel. But Hidalgo said that more IF steel firms are coming up. Steel demand in the Philippines, considered to be the fastest growing in ASEAN with 9 percent growth in consumption, is estimated at 11 MMT of which 4.5 MMT are rebars.

“The real job of DTI, actually by everybody, is to protect the country against substandard construction materials,” said Hidalgo citing the critical role of the Bureau of Product Standards to ensure public safety. He also cited the role of the Department of Environment and Natural Resources to protect the community from unsustainable environmental public impacts.

“The government has all the facts, they don’t need more facts. They know what’s being done by the IF, they know what’s bad about it, who they are, what they’re violations are. It is just up to them to act on it,” he added.

Yao even compared the position of the BPS to that of the Food and Drug Administration to ensure the safety of people. “It is a position where you cannot just be neutral about it,” he added.