Malaysia: Eastern Steel Group expands production capacity with new blast furnace

Malaysian blast furnace steel producer, Eastern Steel, has recently started operating its new blast furnace. The new furnace has an internal volume of 1,380 cubic metres. The new blast furnace will increase the company's annual production capacity of crude steel including slabs and billets from 700,000 tonnes (t) to 2.7 million tonnes (mnt), as per a Japan Metal Daily report.

This new blast furnace is the second blast furnace for Eastern Steel and it is larger and more efficient than the first blast furnace. This new furnace will allow Eastern Steel Malaysia to produce more steel at a lower cost.

Partnership and investment

Eastern Steel is a joint venture between Beijing Jianlong Heavy Industries Group, a prominent state-owned steel company in China, and Hiup Tech Venture (HTVB), a local steel pipe manufacturer. HTVB owns a 27.3% stake in Eastern Steel. The completion and burning of the new blast furnace were announced by HTVB in a disclosure on the Malaysia Stock Exchange.

Expansion plans

Under the management of Jianlong, Eastern Steel has been expanding its operations by utilising injected capital. To further enhance its production capacity, the company has introduced a second slab continuous casting machine with an annual production capacity of 1.6 mnt, provided by Danieli, an Italian steel technology provider. The construction of the second blast furnace was carried out by Shanghai Baojie Group (MCC) in China.

Market impact

Eastern Steel aims to increase its sales of slabs and billets not only in Malaysia but also in Southeast Asia and North Asia. This expansion may have a significant impact on the Asian semi-finished products market. Additionally, the company plans to construct a new hot-rolling (HR) mill. This capacity enhancement project by Chinese companies in Southeast Asia is expected to attract close attention from industry observers.