On November 23, Chinese state-run engineering company China 20 Metallurgical Group started construction of a 1.5 million mt per year rolling line in Indonesia, as announced by its parent company China Metallurgical Group Corporation (MCC).
The project, named Indonesia New Asia International, includes the construction of a 1.5 million mt hot rolled coil (HRC) production line, four hot dip galvanized lines with a total capacity of 700,000 mt per year and supporting equipment. The date of the launch has not been announced so far. There have been no reports about the source of slabs, but most probably they will be imported as the project does not have its own projected steelmaking capacity in its first stage.
Over the next two years, HRC supply in Indonesia will increase rapidly as the hot strip mill No. 2 of Krakatau Steel is nearing its launch, which is scheduled for December 2019 or early 2020, an official at the company told SteelOrbis. The capacity of the line is 1.5 million mt per year and the company has plans to sell about 750,000 mt of HRC from the new mill in 2020.
Higher supply of HRC will be supported mostly by the local demand in Indonesia, which is expected to keep going up by 6-9 percent in the coming years.