It takes tons of courage and dedication to forge ahead—much less expand—one’s business amid uncertain times as the pandemic disrupted industrial production worldwide
Despite being one of the country’s largest steel manufacturers, SteelAsia—the flagship steel company of the Philippines—didn’t get exempted from the economic uncertainty brought about by the current pandemic. The company took a hit last year, with revenues down to only 70 percent of its 2019 output.
Any other CEO would have decided to take a step back, but for Benjamin Yao, a Chinoy businessman recognized in the industry as the “man of steel” himself, it was an opportunity to shake things up and innovate new solutions. And the result? An organization that continues to thrive at a time when most businesses are still trying to recover.
SteelAsia’s CEO, Benjamin Yao, sets his sights on supporting the growth of the country’s steel industry.
Starting in March of 2021, all of its six plants are running at 100 percent capacity, and it was able to protect and keep the jobs of its over 3,000 employees. Apart from the company’s agility, it was also through the help and support of industry partners and stakeholders—including Meralco and its subsidiary MSERV—that SteelAsia could bounce back in record time.
“We are in an industry where power is a major cost—a major component—aside from the raw materials. In fact, labor is much, much lower [a cost] compared to power and fuel. Meralco plays a big role in building the steel industry,” Benjamin says.
Meralco has been the distribution utility for SteelAsia’s Meycauayan plant since 1988. As the steel manufacturer’s operational needs grew over the years, so did the partnership with Meralco, who continued to address SteelAsia’s power requirements as needed.
The partnership between the two companies began over three decades ago, when the power distributor energized the steel manufacturer’s plant in Meycauayan, Bulacan.
A key example was when SteelAsia started manufacturing reinforcing mesh and ramped up the production of steel rebars, which led to the decision to migrate from 34.5-kV to 115-kV. The plant’s migration was completed in August 2018, resulting in optimal power quality and minimal interruptions.
“The migration, together with the load flow analysis, greatly helped in stabilizing the voltage supply in our Meycauayan plant. In addition, being connected to the 115-kV also greatly reduced the systems loss being charged to us,” Yao adds.
MSERV, an energy solutions expert and one of the largest electromechanical contractors in the Philippines, took care of the supply and replacement of the power circuit breaker in SteelAsia’s Batangas plant, which ensured the safe condition of its electrical system.
No retrenchment
SteelAsia also takes pride in keeping its employees and providing a livelihood for them, despite being severely affected in the first few months of the pandemic. At a time when companies are reducing their workforce, SteelAsia was able to retain—and even continues to grow—its workforce.
“We did not retrench any employees. We are hiring more people today. We also have more plants coming up: one in Compostela, Candelaria (Quezon), Cebu, another in Lemery, Batangas, and yet another in Concepcion, Tarlac,” Yao proudly shares.
Due to the pandemic, SteelAsia pioneered off-site fabrication that introduced cut and bend, a value-added rebar solution, to the Philippines, where rebar work was done primarily at construction sites.
“They wanted to lessen people on job sites. So suddenly, our cut and bend products are very much in demand. Off-site fabrication work has become very popular; we deliver to the job site, and the rebars are ready for installation,” the CEO adds.
Benjamin underscored the importance of support from the government through efforts to level the playing field and crackdown on substandard materials and from utility firms through the faster installation of high-voltage lines. To ensure that substandard steel products do not flood the market, Benjamin says SteelAsia has been working closely with the Department of Trade and Industry and its Bureau of Philippine Standards.
“The opportunity is still here in the Philippines”
While Benjamin is first to acknowledge that the Philippines has been lagging in steel infrastructure, citing as an example the Metro Manila Skyway project that began construction in 1995 and formally opened only in January this year, he remains optimistic. “The opportunity is still here in the Philippines—not in Singapore, not in Japan. We just have to do what we can do.”
“If Vietnam could increase its steel production dramatically, that can also be done in the Philippines. We are not a small country—we are a country of more than 100 million people, so there is a market here. There is demand,” he says firmly.
“We are doing our part. Unfortunately, the pandemic is separating the professionals from the amateurs, so to speak. It is tough, but we don’t stop. In fact, we are still expanding. This is our main thrust: to serve our country,” Yao concludes.
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