Pakistan is all set to go for import substitution in the steel sector as a steel-maker has initiated production of refined low-carbon billets, which are used by the downstream steel industry.
The excessive reliance of the industry on expensive imported raw material is going down following the availability of locally produced low-carbon billets in the market, which are used mainly by the wire rod industry.
The locally produced billets will not only save time and foreign exchange but will also ensure smooth and uninterrupted supplies to the downstream steel sector.
Wire rod is a raw material for wire drawing units and it is also used to produce a wide range of products including wire ropes, springs, electrodes, barbed wires, steel reinforcement for aluminum conductors and pre-stressed concrete, wire mesh and fasteners.
“Domestic demand for refined low-carbon quality billets in Pakistan lies between 300,000 and 400,000 tons per year,” said Agha Steel Chief Marketing Officer Suleman Lakhani in a statement. The company aims to manufacture refined low-carbon billets in Pakistan to reduce the country’s reliance on imported steel.
“Until now, the downstream industry has relied heavily on expensive imported raw material,” he pointed out. “However, local production will result in massive import substitution and will benefit the national kitty immensely.”
In this regard, the company has inked a memorandum of understanding (MoU) with Horizon Steel, according to which Agha Steel will sell 100,000 tons of low-carbon billets worth approximately Rs10.5 billion to it annually.
Following the signing of the MoU, sales of Agha Steel would grow 68% within a year, said the chief marketing officer.
Published in The Express Tribune, September 29th, 2020.
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