Kobe Steel’s black pellet production feasibility study project in Malaysia and Vietnam selected for METI FY2024 supplementary budget Global South Future-Oriented Co-Creation Project Subsidy Program for Small-Scale Demonstration/FS Projects
Sep. 01, 2025
Kobe Steel, Ltd.
Kobe Steel announces that its black pellet* production feasibility study project in Malaysia and Vietnam was selected for the Ministry of Economy, Trade and Industry (METI) FY2024 supplementary budget Global South Future-Oriented Co-Creation Project Subsidy Program for Small-Scale Demonstration/FS Projects.
The selected project aims to investigate the feasibility of using wood biomass (known as white pellets) made from tree species that are widely distributed in Malaysia and Vietnam as a raw material for producing black pellets, as well as to advance studies toward building a carbonization plant and establishing stable supply chains for black pellets in these countries.
For reference: The special website of METI FY2024 Global South Future-Oriented Co-Creation Project Subsidy Program for Small-Scale Demonstration/FS Projects (available only in Japanese)
Kobe Steel sees black pellets as a promising alternative resource that could help reduce CO2 emissions in power generation and ironmaking processes and aims to become a frontrunner in spreading their use both domestically and globally. To advance this initiative, Kobe Steel has collaborated with Mitsubishi UBE Cement Corporation (MUCC) as announced on May 15, as well as with Samling Strategic Corporation Sdn Bhd in Malaysia as announced on August 25, 2025, to carry out respective joint feasibility studies. This selection for the subsidy program will boost these efforts.
Part of the study for the use of black pellets in the steelmaking process is conducted under the New Energy and Industrial Technology Development Organization (NEDO)’s commissioned and subsidized research and development project JPNP21019 (GREINS).
The Kobe Steel Group (also known as the Kobelco Group) is taking on the challenge of realizing carbon neutrality under its current Medium-Term Management Plan. The joint feasibility study on black pellet production is an initiative that contribute to carbon neutrality. Our Group will continue to move forward with the transformation into an appealing company for our stakeholders by integrating its diverse technologies, products, and services in a unique way, with a view to a world in which people, now and in the future, can fulfill their hopes and dreams while enjoying safe, secure, and prosperous lives.
- *Wood pellets, commonly known as white pellets, are a popular biomass fuel used around the world, including Japan. Black pellets, created through thermal treatment (torrefaction) of white pellets under specific conditions, have the heating value comparable to coal and are expected to be a low-CO2 alternative with the potential to be utilized as both a fuel for power generation and a raw material for steelmaking. White pellets are made from trees that have been cut for healthy forest development, as well as scraps and sawdust from the lumbering process and other underutilized timbers. Trees, which absorb CO2 as they grow, are considered as a carbon-neutral raw material and fuel. Using wood in steelmaking processes and thermal power plants can help to reduce the use of coal and contribute to decarbonization, while minimizing environmental impact. Since black pellets are a carbonized, water-resistant raw material and fuel, they can be stored in the open air, making it easier to prevent spontaneous combustion and implement other safety control measures. This enables us to use them as a raw material and fuel with lower risk and higher safety.
- *The information on this web site is presented "as is." Product availability, organization, and other content may differ from the time the information was originally posted. Changes may take place without notice.
