Its group executive chairman Datuk Lim Kiam Lam said the tight supply of construction steel and the demand-pull price upswing are expected in the medium term.
"The demand is expected to pick up in the second half of 2010. However, in the immediate term, a lot of correction is expected as the economies are still in early stage of recovery," he told a media briefing after the company's annual general meeting in Kuala Lumpur yesterday.
Lim said the urbanisation and industrialisation in the emerging markets and developing countries, particularly Brazil, Russia, China, Association of South-East Asian Nations (Asean) and Indian sub-continent, were expected to drive up steel demand to even exceed the pre-crisis level of 2007.He said Ann Joo expected the main export market to contribute 50 per cent to its revenue and the rest from domestic market.
"Our export margin is good. Vietnam is currently our largest export market. It absorbs 60 to 70 per cent of our exports as the country was relatively not affected by the recent financial crisis," he said.
Lim said the company is also eyeing Indonesia as the government has huge plans for infrastructure projects and Sri Lanka, where demand for steel was expected to be substantial.
He said demand in the domestic market was expected to pick up in the second half of the year or early 2011.
"In anticipation of the spike in demand, Ann Joo plans to boost its current capacity to 1.5 million tonnes from 800,000 tonnes per annum by improving efficiency," he said.
Lim said the company is expanding its modern blast furnace, the first in Malaysia, and it is expected to commence operation by the second half of 2010.
"The expansion will not only provide solid growth for the group's business but also an integration of our iron and steel production which will offer synergy for the entire group's operation.
The company, he said, also aimed to be among the biggest in Southeast Asia. - Bernama
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.