Manjung – Malaysia’s next Steel hub. When we first heard rumours that Vale International, the world’s second largest diversified metals and mining company and Latin America’s largest company by market cap, was looking to set up a transshipment hub and iron ore pelletizing plant in Manjung, Perak, we were somewhat sceptical. We had asked what Manjung has to offer to an international giant. However, a visit by our Research Team (see report “Destination Manjung” dated 15 Jan) revealed that the deepwater port at Manjung, which currently caters for the TNB’s coal fired Janamanjung plant, would allow Vale to send Very Large Ore Carriers (VLOCs) which could unload iron ore to be then resent using smaller ships, thus making a iron ore distribution centre for South-East Asia feasible.
With 166 ha of land acquired by Vale with a further option of 306 ha of land plus a transshipment services agreement signed with Integrax, the operator of Lumut Port, we believe there is potential for Manjung to draw RM9bn of investment for a transshipment hub and iron ore pelletizing plant. This RM9bn will definitely transform the sleepy Manjung and will go a long way towards addressing the outflow of DI from Malaysia. We expect the winners of this latest development to be the Malaysian steel sector, Integrax and YNH Property, the major developer in the region.