Demand for iron and steel
in Indonesia was predicted at 13 million tons this year. The trend for demand
was on the upturn. In 2015 the demand would be governed by policy of the
Jokowi-JK Government on acceleration of infra-structure projects. Demand of 13
million tons showed there was around 8.3% growth against showed not all need
was fulfilled by domestic supply, 40% of need was still imported. Production
capacity of domestic crude steel was now 4 million tons, at post processing
stage it became 8 million tons.
Ansar Buchari, Secretary General of the ministry of
Industry stated in Jakarta on Tuesday (24/2) that demand for raw materials in
four upstream mineral based mining group could grow by more than 25% by 2035. Ansari
stated that exploration of natural resources for industry should be intended
for strengthening of the industrial structure, to increase added value and to
fulfill industry need.
As per this until 2019, the need for raw materials for
the basic steel industry was estimated at 20 million tons per year. Meanwhile
other upstream industry products like nickel was predicted to need 11 million
tons, and aluminium around 600,000 tons per year. The four said sectors was
predicted to have increasing demand for raw materials for the next 15 years.
Growth was varied by sector but on the average increase
was more than 25% or oven 50% perannum. For example, in the projection of
2020-2024 demand for iron raw material increased to become 28 million tons,
copper 3 million tons and alluminium 1.2 million tons per year. Trough 2015 –
2035 the need increased to 40 million tons for steel, 17 million tons for
nickel and 2 million tons for aluminium. Ansari stated that in parallel with
the growing need for raw materials, annual production capacity also increased.
The fastest development of production capacity was the aluminium industry
growing by above 60% per year.
He admitted that development of iron and steel industry
at home was handicapped by low energy supply and raw materials. The steel
industry still had to import raw materials from above including raw materials
and scrap. And yet according to data of the Ministry of Energy and Mineral
Resources iron and steel reserve in Indonesia was posted at 1.7 billion tons
located in Sumatra, Kalimantan, Sulawesi and Nusa Tenggara.
Meanwhile industrialists were expected to promote
technology and equipments for the steel industry to strengthen competitiveness
at home and abroad. Chairman of APLINDO Ahmad Saifun admitted that the
technology and equipments used by national steel industry was still interior
compared to elsewhere in the world.
He showed as an example various metal products was still
imported like light steel construction and alluminium by products. Of the total
need of 850,000 tons of aluminium, production of raw materials was only 250,000
tons per year while the domestic steel filled with imported products. Data of
SEAISi unveiled that the demand for steel last year was posted at 12.7 million
tons of which 66% was to be filled with imported products. Saifun stated that
minimum supply from the upstream sector was due to poor innovation and
advancement of technology. (SS)
Business News - February 27, 2015
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