Jakarta, Feb 28 (ANTARA) - Steel price has been increasing in the
country since early this year but steel industries are complaining of
the flood of steel imports from China.
According to Sudirman Maman, chairman of the Indonesian Automotive
Industry Association (Gaikindo), steel price had been increasing by
about 13 to 15 percent since January.
He said here on Thursday that the price increase in steel had the
potential to boost the selling price of automotive products.
National steel industries are forced to raise the price of steel at
home as a result of the significant increase in the price of raw
materials such as iron scrap, iron ore pellets and slabs.
The price of raw materials, most of which are imported, has been moving
up since early this year. Since January, the price of scraps, for
example, has increased 13 percent from US$380 per ton in October 2012 to
US$430 per ton now.
The price of imported iron ore pellets has increased 30 percent from
US$115 per ton to US$150 per ton. Steel slabs are now sold at US$540
per ton from US$470 per ton in October 2012.
Amid the price increase, however, local industries have been
complaining of the floods of imported steel from China in the domestic
market.
PT Gunawan Dianjaya Steel Director Gunato Guawan suspected recently
that the price of Chinese steel was lower because Chinese exporters
carried out unfair business practices by cheating the customs office,
namely manipulating import duty regulations imposed by the government.
"They
claimed through the import document that their steel products contained
boron but when checked they only contained 0.008 percent," Gunato said.
He said that they did so to avoid paying the 5 percent import duty
imposed by the government. Besides that, the Chinese government also
provides a 9 percent export tax return to exporters who admitted to have
added boron contents to their steel exports.
This means Chinese steel exporters enjoyed a 14 percent export tax
facilities. With a 14 percent export tax facility, Chinese exporters are
able to cover the production cost of steel they exported to Indonesia.
The same complaint was also raised by Djamaluddin Tanoto, president
director of PT Gunung Raja Paksi, who said that the steady inflow of
Chinese steel into Indonesia dealt a heavy blow to the local steel
producers.
After all, this month local producers were forced to raise the price of
their steel products by about 13 to 15 percent, Djamaluddin said.
Besides, PT Gunung Raja Paksi, other steel producer industries such as
PT Krakatau Steel and PT Gunawan Dianjaya Steel also have raised the
prices of their products.
"We cannot avoid the price increases. The prices of various raw
materials also increased such as scraps, iron ore pellets and slabs. We
raise the price not because we want to gain benefit but because we want
to keep local industries to remain in production," said Djamaluddin.
Marketing director of PT Krakatau Steel Yerry said that actually steel
industries in Indonesia were the last ones to raise prices. Regional
producers in other countries such as Malaysia, Thailand and Vietnam have
raised the prices of their products since last month. They also faced
the same problem, namely an increase in raw material prices.
Actually,
the Ministry of Industry has decided to focus on developing Indonesia's
upstream basic chemicals and steel manufacturing industry in light of
the contribution of the two sectors to the national economic growth.
The industry ministry's general director Panggah Susanto said last
month that the basic chemicals and steel manufacturing industries
accounted for 70 percent of the national revenue, excluding the non-oil
and non-gas industries' revenues.
"That
is why we have to develop these two industries. Our dependence on
imported raw materials for the basic chemicals and steel manufacturing
industries is still very high," he noted.
According to Genot Ringling, director of Messe Dusseldorf Asia,
Indonesia has the potential to become the biggest steel producer in the
region in line with its economic growth that would boost steel
consumption.
"Now Indonesia's steel consumption has become the second biggest in
ASEAN reaching 10.95 million tons per annum," Gernot Ringling said.
He made the remarks during an expose on "International Expo on Metal and Steel" held from February 20 to 23, 2013.
Ringling said that the demand for steel in Indonesia would continue to
increase in line with Indonesia's infrastructural connectivity program
2025.
This will cover the construction of roads, seaports, airports, railway
tracks and energy generators that would be done to support the national
economic corridor development.
"In accordance with prevailing conditions, steel and iron industries
will continue to shift from advanced countries to developing nations
like Indonesia," he said.
He said that Indonesia now was the worlds' 16th biggest economy and was
predicted to reach the seventh position in 2030.
At the same time, Indonesia's middle and upper class population would
reach 135 million, drastically increasing from 45 million.
In the meantime, urban people would account for 71 percent of the total population, up from 53 percent previously.
Besides, Indonesian skilled workers in 2030 will reach 113 million, up from 55 million in 2012.
Indonesia's economy will focus on industrial competition in six groups
of industrial sectors. The first is intensive working group industry
such as furniture. The second group covers small scale industries such
as textile, ceramics and essential oils.
The third group is capital intensive industry such as machinery and
shipping products while the fourth one included natural resources and
basic industries such as iron, aluminum, and upstream industries.
The fifth group is industries with high growth such as automotive,
electronics and telematics, while the sixth one is special priority
industry such as petrochemicals.
Ringling
said that iron and steel industrial development would be boosted by
Indonesia's economic corridor development program in Java island such as
automotive industry in Jakarta and ship building in East Java.
"The
strength of steel industry in Indonesia could be seen in the investment
value which is estimated to reach Rp40 trillion in 2015," he said.
In
all, it is estimated that some 300 domestic firms would be able to
produce 5.5 million tons per annum with the number of workers they could
absorb reaching 300,000.***3***
(T.A014/S012)
(T.A014/A/A. Abdussalam/Suharto) 28-02-2013 20:54:4 |
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