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Stainless steel manufacturers face material scarcity in nickel-rich Indonesia
Despite becoming the world’s number one stainless steel products exporter, Indonesia is finding its local industry pinched, as producers are deprived of raw materials to keep manufacturing going, while having to deal with a barrage of imported finished products.
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Hot topic: A furnace operates at the nickel smelting facility belonging to PT VDNI on the Morosi industrial estate in Konawe, Southeast Sulawesi on Sept. 9. The company processes nickel to produce stainless steel. (Antara/Jojon)
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espite becoming the world’s number one stainless steel exporter, Indonesia is finding its local industry pinched, as producers are deprived of raw materials to keep manufacturing going, while having to deal with a barrage of imported finished products.
Amid the challenges, industrialists are urging the government to amend its policy to save dying local stainless steel product manufacturers.
The Indonesian Stainless Steel Development Association (PPSSI) told The Jakarta Post that producers have been having difficulties in importing enough stainless steel raw materials to make finished products like kitchenware, cutlery, sinks and wash basins, among many other items.
Producers have to face a complicated, yet tiring, bureaucratic process to acquire a quota and those who make it to the end are only able to acquire between 10 and 15 percent of their actual required imports, the association said.
Many local producers have seen their production go into steep decline over the past years with several of them being forced to cease production due to an absence of stainless steel as a raw material. Among them are small and medium producers.
“I am afraid if the government continues to adopt the wrong policy on imports, this could lead to the demise of the local stainless steel industry,” PPSSI chairman Steven Ponny Sutiono told the Post on Dec. 5.
Read also: New commodity balance scheme may ward off Indonesia's steel import boom
