Indonesia needs 15 more BFs to reduce steel imports dependence

The Indonesian government said there needs to be an additional 15 blast furnaces (of 1.2 mnt each) in the country which will add another 18 mnt of steel production capacity to reduce dependence on imports, as per Lange Steel.

"The addition of 15 new blast furnaces will reduce Indonesia's steel imports volumes," said Dr. Ir Taufiek Bawazier, the Director General of Ministry of Metals, Machinery, Transport Equipment.

Current steel demand-supply scenario

Currently, Indonesia's downstream steel demand is about 17 million tonnes per annum (mtpa). The country has been importing steel products to meet its increasing demand. At present, steel imports into Indonesia amount to 13 mnt while domestic supply is about 4 mtpa.

At present, there are three integrated steel manufacturers that use blast furnaces for steel production, namely, PT Krakatau Steel Tbk (of 1.2 mtpa capacity), PT Krakatau Posco (3 mtpa) and PT Dexin Steel Indonesia (3.3 mtpa).

However, Krakatau Steel is now discontinuing the use of blast furnaces and opting for electric arc furnaces. The company has already started its EAF facility having a capacity of 3 mtpa.

Upcoming BF expansion plans

Steel major Krakatau Posco is likely to build a blast furnace of 2.4 mtpa capacity. With this addition, upstream steel production will reach 9.6 mtpa.

The company also plans to build a cold-rolling plant of 2.4 mtpa in the same year, taking the country's total CRC production to 3.7 mtpa.