Japanese steelmakers are asking Indonesia to remove duties on imports of certain Japanese cold rolled coils, especially for the automotive sector. They are pointing to their significant investments in Indonesian steel processing capacity to show the duties are now counterproductive for the local economy, Kallanish notes.

JFE Steel president Koji Kakigi said that the investment gives Indonesia the ability to make autosheet at least as good as that made in Japan. He was speaking at the opening of his company’s 400,000 tonnes/year auto sheet continuous galvanising line in the country (see Kallanish 19 September). The line will rely almost entirely on imported CRC from JFE’s Japanese facilities however.

Nippon Steel and Sumitomo Metal Corporation (NSSMC) meanwhile is building a 480,000 t/y galvanising, annealing and processing line in Indonesia in joint venture with PT Krakatau Steel. It will also rely mostly on Japanese substrate, although it has said that it will work with Krakatau to improve the quality of its hot and cold rolling capability.

Japanese steelmakers are looking for growth sectors as domestic demand is stagnant. They are hoping to supply Japanese carmakers in Indonesia’s growing market. Indonesia produced 669,772 vehicles over January-July, up 4.7% year-on-year.