Philippines' Mount Zynai 0304 Mining Corporation plans to build an integrated steel mill cum smelter plant at Barangay Santa Cruz, Diplahan town in Zamboanga Sibugay, sources told S&P Global Commodity Insights June 28.

          The mill is expected to have a production capacity of 1.5 million mt/year of steel bars and products and will form part of the Mount Zynai Industrial Park under the Mount Zynai integrated steel mill and smelting plant. Construction of the mill is expected to begin in July and come online four years thereafter.

          "...we still working on it. The technical consultants will come out a detailed plan," MZMC said when contacted by S&P Global.

          "The bar demand in the Philippines per year was at around 5-6 million tons," said a Manila-based source, so the new mill will account for at least 20% of local demand.

          Demand for long steel products stood at 5.7 million mt in 2020, down 16% year on year, data from the South East Asia Iron And Steel Institute showed, with local production at 3.7 million mt and imports at 2 million mt. As a result, the new mill could cut imports by as much as 75% too.

          "They are supposed to produce their own billets," one of the sources said, but noted the project is in an "early stage" and faces "much uncertainties", referring to a likelihood that the project might be delayed.

          "I think it will affect the import volume of billet in the Philippines. However, this project has not started yet, and might be some changes in the next few years. Therefore, so far, it won't be any impact on billet import in the Philippines," a China-based billet trader said.

          Iron ore for the projected steel mill is expected to be mined locally. Early February, MZMC obtained a mineral production sharing agreement, or MPSA, for an iron ore mine at Zamboanga del Sur and a coal mine at Zamboanga Sibugay, from a domestic mining company Czarstone Mining Corporation, which will ensure raw materials for the mill and smelting plant.