Corporate News

SteelAsia forges deals with Russian steel makers

Posted on May 27, 2017

STEELASIA Manufacturing Corp., the Philippines’ leading steel company, has forged supply and technology cooperation deals with two of Russia’s largest steel makers that will enable the firm to take part in the government’s ambitious infrastructure program.

Closing a USD250 million dollar deal are Olga Bogacheva (Head, East Metals Evraz Moscow) and Benjamin O. Yao (Chairman and CEO, SteelAsia). Witnessing the signing are (l to r), Joe Concepcion (Presidential Adviser on Entrepreneurship) Trade Secretary Ramon Lopez and Agriculture Secretary Emmanuel Piñol.
The agreements were formalized during President Rodrigo R. Duterte’s visit to Russia this week.

SteelAsia -- also the largest manufacturer of steel bars in Southeast Asia -- signed a $250 million, long-term supply agreement with Evrazhave for a guaranteed monthly supply of 50,000 tons of semi-finished steel for its rolling mills in Davao City and Meycauayan, Bulacan.

Billets are the input material for many long steel products, including rebars.

SteelAsia also sealed a cooperation arrangement with Kurganstalmost JSC for engineering, training and technological transfer services.

“We have found that Russian companies are very reliable business partners,” SteelAsia Chairman and CEO Benjamin O. Yao was quoted in a statement as saying.

The long-term billet supply contract assures the company of a stable supply of raw material, insulating the country from a rebar shortage, while the technology and skills transfer are in preparation for SteelAsia’s diversification into steel structures, Mr. Yap said.

“Our expansion plans are all geared towards supporting the country’s focus on massive infrastructure build up,” he said.

Since 1998, SteelAsia has procured about 3.24 million tons of billets worth $1.23 billion from Russia. In the first quarter of 2017, the company has purchased 240,000 tons of billets worth $93 million.

SteelAsia works with several Russian steel companies, including NLMK and Evraz, OEMK/Ural Steel/Metalloinvest, JSC Amurmetal, Amurstaal, KMK, and Mechel.

Evraz has operations in the Russian Federation, the Ukraine, the United States, Canada, the Czech Republic, Italy, Kazakhstan, and South Africa. Its crude steel output last year topped 13.5 million tons.

Kurganstalmost, part of the Russian industrial and infrastructure giant Mostostroyindustria of the Transstroy Corporation, brings with it cutting-edge technology and engineering services, an experience in operation in steel structure production, a training center, and Russian Exim financing at competitive rates and terms.

SteelAsia has a capacity of 2.3 million metric tons, with six plants strategically located across the country. It is expanding its rebar capacity to 4 million metric tons in the next five to seven years. -- Krista Angela M. Montealegre