Japanese steel giants plan to expand their production in Indonesia

Major metallurgical companies Nippon Steel & Sumitomo Metal Corporation and Mitsubishi Steel decided to invest in the creation of new facilities in Indonesia. These two steel titans, based in Japan, are going to invest 450 million dollars in the construction of specialized metallurgical plants and service metal centers providing services Metal bending and cutting as well as processing facilities.

NSSMC plans to join Krakatau Steel, the largest steel company in Indonesia, to produce automotive steel and general purpose galvanized steel in Indonesia, while Mitsubishi is set to acquire 34 percent of Jatim Steel Manufacturing, one of Indonesia's largest long products.

The joint venture between Krakatau Steel and NSSMC will give birth to a new joint venture in which 80 percent of the shares will be owned by NSSMC and what will be known as the “Krakatau Nippon Steel Sumikin”. The new plant plans to produce strip steel and may require investments of up to $ 300 million. NSSMC intends to provide additional funding for the project in the amount of $ 133 million. The plant will be built in Cilegon and is expected to provide employment for 280 people. The main focus of the plant is the production of hot-dip galvanized steel and hardened steel rods, which can meet the needs of the automotive metallurgical sector in Indonesia. Production is expected to start in 2017.

As for Jatim Steel Manufacturing, Mitsubishi Steel's acquisition of 34 percent of the shares is aimed at increasing production capacity. The company plans to significantly increase the production of long products, with the goal set to reach 170 thousand tons per year.