Krakatau Steel, Posco South Korea to Realize Rp53tn Investment Next Year

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  • TEMPO.CO, JakartaKrakatau Steel and Pohang Iron and Steel Company—or Posco—from South Korea will realize US$3.7 billion worth of new investments or around Rp53 trillion next year. President director Silmy Karim said that the purpose of this investment is to pursue the steel cluster production target.

    "A steel cluster [with a capacity of] up to 10 million tons [per year] will be realized in 2022," Silmy said in a video from the Presidential Secretariat's YouTube channel on Tuesday, September 21.

    The investment comprises US$700 million for increasing the production capacity of hot rolled coin (HRC) derivatives and US$3 billion for adding steel production facilities on the upstream side.

    Silmy said that, in five years from 2014, steel consumption per capita in Indonesia continued to grow from 50 kilograms per year to 71 kilograms per year, or at a rate of 40 percent.

    As one of the steps to increase production capacity, Krakatau Steel has just completed the construction of its Hot Strip Mill 2 (HSM 2) factory. Located in Cilegon, the factory—built with an investment of US$521 million—began operating in 2021 with a production capacity of 1.5 million tons of HRC.

    Read: Krakatau Steel Eyeing 20.77 Percent Export Growth in 2021

    FRANCISCA CHRISTY ROSANA