MALAYSIA Steel Works (KL) Bhd (Masteel) has clinched a deal to export RM120 million worth of steel bars to Australia over the next two years under an agreement with Stemcor Australia Pty Ltd. Its managing director and chief executive officer, Datuk Seri Tai Hean Leng, said the deal signified the company's commitment to export substantial amount of steel bars to the Australian market.
"Australia and New Zealand will be our main markets in the next four to five years," he told reporters after signing the off-take agreement with Stemcor here today. Also present was Deputy Trade Minister of International Trade and Industry Datuk Jacob Dungau Sagan. Stemcor is an independent international steel trading organisation.
Tai said the agreement would allow Masteel to penetrate growth markets like Australia and New Zealand and at the same time, bring about export income for the country. "Cementing our presence in the Australian market would further augment our expertise as an exporter of steel billets to the Asia Pacific markets.
"This is part of our long-term strategy to focus on export markets for growth and we have worked hard to establish this for the last five years," he said. Adding another feather to its cap, Masteel was awarded the Certification of Product Compliance from the Australian Certification Authority for Reinforcing Steels (ACRS) for the steel manufacturer's continued effort to raise the bar and ensure the safe and consistent quality of its products.
ACRS is an independent third-party accreditation system with the goal to ensure that reinforcing steels are quality-approved materials which comply with Australian standards. Tai said the company could also import the products to New Zealand as it has accepted the ACRS standard. "Masteel has already made headway into New Zealand market and its first export deal is expected to be concluded within the next few weeks," he said.
He said currently, export market made up to 35 per cent of Masteel's production capacity, which annually produced 450,000 tonnes of billet and 350,000 tonnes steel bar. "We will continue to invest between RM15 million and RM18 million on new technology to boost efficiency and quality to reduce manufacturing cost next year," he said.
Tai said despite global economic meltdown, the company expected demand for steel to recover from the fourth quarter this year on the government's pump-priming initiatives to boost steel demand.
"Given this backdrop and with this new off-take agreement, Masteel is optimistic these developments will contribute to a healthier financial performance for the next two years," he said.