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THE INDONESIA’S MARKET FOR STAINLESS STEEL
• The global economic crisis has changed the shape of the world economy. The crisis that began in the United States in 2007 spread worldwide, with no exception to developing countries including Indonesia. However, until the third quarter of 2008 the Indonesian economy was still charting above 6% growth with continued healthy performance in the financial sector reflected in a stable exchange rate. However, toward the end of 2008, the fallout from the crisis began to take hold. Weakening exports, pressure on the balance of payments and turmoil on the money market took their toll on Indonesia’s economic growth. • During 2008, Indonesian’s economy maintained adequate performance amid the global turmoil. Overall economic growth reached 6.1% in 2008, slightly below the 6.3% recorded in the previous year. This growth was primarily driven by private consumption and exports. • On the demand side, the effect of weakening global demand in the first half of 2008 was still offset by high world commodity prices. As a result, exports and investments maintained growth. In the second half of 2008, however, Indonesian exports were hit by the downturn in global economic growth and heightened uncertainty on financial markets, and slowed significantly during the final quarter of the year. • Bank Indonesia projects a drop in economic growth in 2009 to around 4.0% with downside risk if the global economic downturn is greater than predicted. The more modest growth in Indonesia cannot be regarded as bad when compared to the many other countries forecasted to record negative growth. • One of the advantages of the Indonesian economy is the large population that represents a potential market supporting economic growth. During 2009,
Prepared by Data Consult 3
including textiles and textile products.Indonesia’s Market for Stainless Steel economic growth in Indonesia will be driven primarily by domestic demand and especially household consumption. • Weak domestic and external demand will force companies in the manufacturing sector to suspend production in a move to avoid excessive build-up of stocks.9 thousand tons in 2006 . commercial kitchen products and gasket manufacturing. while in the last five years the average growth is almost 50% a year. electronics. wood and wood handicrafts.4 thousand tons in 2001 to 140. The market value has also increased from only US$ 117 million in 2001 to around US$ 200 million in 2005 and rocketed to around US$ 563 million in 2008. particularly in view of the government plans for an added fiscal stimulus in 2009. The reason for this flagging performance is weakening exports in tandem with slowing domestic demand. but revived strongly afterward to to 322 thousand tons in 2008. automotives. household consumption is still expected to show resilience. Despite predictions of slowing. The global economic crisis will give significant blow to export oriented manufacturing. • • • Prepared by Data Consult 4 . down significantly from the preceding year.0%. The average growth of market size in the last 8 years is 32% a year. declined slightly to 123. The spectacular market growth of over 100% in 2008 was driven by the rising demand for flat products particularly of cold rolled products of less than 600 mm wide. electrical component . • Manufacturing industry growth in 2009 is forecasted to reach 2.7 thousand tons in 2005 . Stainless steel market • The market size of stainless steel in Indonesia hasfluctuated with increasing trend from around 76. These type of products are used mainly by automotive component industry. footwear.
The Indonesia’s consumption of stainless steel is still small.1 thousand tons or 61. 16 % for bars and wires. • • Flat products • The market size of flat products totals 243 thousand tons with a value of around US$ 394 million in 2008.Indonesia’s Market for Stainless Steel • The market is dominated by flat products accounting for around 75% and the remaining share for bars & wires ( 17. However.5 kg as compared to 33 kg for carbon steel. there has been a notable volume of export of cold rolled flat stainless steel due to the operations of cold milling mill of PT Jindal Stainless Steel which is export oriented. but both of them use imported materials for their productions. There is a trend of increasing share of bars and wires.2 thousand tons or 38. In the meantime. Per capita stainless steel consumption is around 1. There are plans to develop nickel smelter and stainless steel making plants. In terms of value. A study made to import documents in 2006 revealed that 40% of flat stainless steel imported consist of SS 200 series and 38% of 300 series.6 % of total import in 2008. 5 % for tubulars and 12 % flanges and fittings. tubular (2. while the shares of tubulars and fittings tend to decrease over the last 8 years. but these projects are suspended .000 tons or around 5% of the total consumption of carbon steel which is around 7.6 %). only around 320. since 2006. The market is still fully dependent on import for stainless steel materials as there has not any stainless steel making company yet in the country. There are two cold rolling mills. Imported hot rolled flat stainless steel amounted to 167. while cold rolled flat stainless steel 105. the composition is 67 % for flat products.7%) and fitting and flanges (4.5 million tons a year. around 30% million is used by existing cold rolling millers.5%). Most of SS • • Prepared by Data Consult 5 .4 % .
PT Heisei Stainless Steel Industry ( Pipe indusry ) and PT JFE Shoji Steel ( trading and coil center).00 ( Wire of stainless steel ) is the main types of bars and wires imported into Indonesia. Jindal . Top five suppliers are Acerinox. about 70% of imports are done by end users. Singapore . Inox Stal Handelsselskab. 12 % SS 316 and 8 % of special grades HS 722 300. JFE Shoji Trade Corp . • Including Jindal. • • • Bars and wires • • • • Total market of stainless steel bars and wires is estimated at 56. the composition of imports is 62% by direct users and 38% by traders.4 million ( CIF value) in 2008 The annual growth in 2001 and 2008 is around 45 % with substiantial growth experienced in 2008 In terms of value . and only 30 % by traders / stockiest.Indonesia’s Market for Stainless Steel 200 series consist of SS 201 or J 4 grade which are imported mainly by PT Jindal Stainless Indonesia.4 thousand tons valued at US$ 92. PT Steel Pipe Industry Indonesia ( Pipe industry). furniture manufacturers. steel constructions and agriculture equipment manufacturers. Malaysia . and only 25% by traders / stockiest. Other major users are plant equipment fabricators. PT Sutindo Raya Mulia ( Trader). Sunstar Logistic. the structure of the market consists of 69 % SS 304. Excluding . Import of this product totalled US$ 27 million or 30 % of total import. About 75% of imports are done by end users. Stainless pipe industry is the third largest user of flat stainless steel particularly of hot rolled products. if Jindal is excluded. However. • Prepared by Data Consult 6 . top five importers are PT Kingfurn International ( furniture industry). and Oitokumpu Stainless OY The automotive components and kitchenware industries are two largest segments of end users of flat stainless steel. contributing 26 % and 22% respectively to total market.
5 mm lt. This company use 200-250 tons stainless steel wires a year. bar and wire stainless steel . PT Good Rich Pindad Aeronautical ( airacraft component). followed by bolt and nut industry ( 13.Indonesia’s Market for Stainless Steel • Top five importers are PT Alam Lestari Unggul ( Wire ). PT Sutindo Raya Mulia ( stockiest).17-5.5%) and furniture industry (7. Wire and welding electrode industry is the largest segment of end users of rod .1%).of circ cross sect. The main countries of origin are Taiwan. SS 316 ( 13%) and SS 400 ( 7%). while PT Avesta Welding uses stainless steel core wire for their materials. diameter less than 37. • • Prepared by Data Consult 7 . • • • Tubular products • Total market of stainless steel tubular products is estimated at 14. PT Alam Lestari Unggul and PT Avesta Welding are two largest users of stainless steel bars and wires.pipe&hollow profiles. PT Moon Lion Industries use XM7B stainless steel wire of of 2. . PT Avesta Welding ( welding electrodes). Bolt and nut industry is also a major user of stainless steel wires.smls. Germany.stainless steel . welded 12.25 mm diameters.8 thousand tons in 2008 valued at around US$ 60 million ( CIF value) . Menam Stainless Wire ( Thailand). PT Alam Lestari Unggul is a wire producer that use stainless steel bars for their raw materials. Japan. Nippon Reinz Co ( Japan) and Light Metal Sdn Bhd ( Malaysia).5 mm of stainless steel) and HS 730449 (tubes. One of the major bolt and nut producer. contributing 43 % to total market . and PT MCI Prima Gasket ( Gasket industry) Top five suppliers are Thengzhou Tengda ( China). Kuang Tai Metal Industrial ( Taiwan) . Import is dominated by welded stainless steel pipe of HS 730640 ( other tubes.nes) The main grades of stainless steel imported are SS 304 ( 73 %) . China and Korea.
mining contractors. These three segments contributed a combined market share of 77% . PT Indah Kiat. Flanges and fittings of stainless steels are used mainly by Electric power generation/ equipment. a sharp increase as compared to only US$ 29 million in 2007. Around 90% of products are imported by direct end users and only 10% by traders/ stockist. the state electricity company is the largest user of flanges and fittings . PT Komponen Futaba ( automotive component) and Sutindo Raya Mulia ( trader) Top five suppliers are Thengzhou Tengda ( China). Top five importers are PT Siemens Indonesia ( electreical). (Pulp and Paper). Indah Kiat group ( pulp and paper) . Nippon Reinz Co ( Japan) and Light Metal Sdn Bhd ( Malaysia). oil and gas industries.0 million ( CIF value) in 2008. Major importing end users include PT Siemens Indonesia ( Electrical equipment).730721 (stainless steel flanges) accounting for 92% and the rest by stainless fittings ( HS 730723) . shipbuilding company. The market is dominated by products of HS No. Menam Stainless Wire ( Thailand). power plant projects. Major importing end users include marine construction/ equipment fabricators. Kuang Tai Metal Industrial ( Taiwan) . PLN . PT AT Indonesia ( Automotive component). plant equipment and heavy equipment assemblers. Automotive industry is also the largest user of stainless steel tubular products accounting for about 27% of the total market. PT AT Indonesia ( automotive component). • • • Fittings and Flanges • Total market of stainless steel fittings and flanges is estimated at US$ 67. Other major end users are Pulp and paper industry ( 19%) and electrical equipment industry. oil and gas companies.Indonesia’s Market for Stainless Steel • Around 80 % of stainless steel of tubular products are imported by direct end users and only around 20% by traders/ stockist. steel construction . 8 • • • • Prepared by Data Consult .
particularly in view of the government plans for an added fiscal stimulus in 2009. Recommendations The study recommends several prospective market segments to be further studied to explore their buying preferences. These recommended prospective market segments are automotive component industry. wire industry. market growth etc. sources of raw materials . as some of their downstream products such as home appliances. their processing facilities . The worsening outlook for the world economy also prompted business to postpone investment spending and to pursue efficiency improvements.Indonesia’s Market for Stainless Steel Market prospects The weakening global demand due to global economic recessions will effect demand for various export products of Indonesia including those related with stainless steel based products such as commercial kitchenwareaand home appliances. food processing. Despite predictions of slowing. pulp and paper. household consumption is still expected to show resilience.com to obtain the full report. resulting in slowed investment growth with knock-on effects on public purchasing power. and automotive components have still encouraging prospects. Please email to survey_dataconsult@yahoo. electrical components and steel constructions. Enclosed is the list of content of the report Prepared by Data Consult 9 . plant equipment. Although not as strong as previous years especially in 2008. the market for stainless steel products will be still quite prospective . the market size in the following years are expected to be still larger than the situation in 2007. kitchenware. Although expecting a downturn in the market size as compared to the exceptionally high market in 2008. One of the advantages of the Indonesian economy is the large population that represents a potential market supporting economic growth.
Global economic crisis to slow down economic growth Indonesian economy in 2008 Indonesian economy outlook for 2009 Manufacturing sector the backbone of the economy Trend of construction sector 1 3 4 8 9 12 15 15 17 20 24 27 27 29 31 CHAPTER III – TECHNICAL ASPECTS 3.2.2 126.96.36.199. 2.3 3. 4.4 Definitions and product characteristics Properties Technical standard Application of stainless steel CHAPTER IV – MARKET SIZE OF STAINLESS STEEL PRODUCTS 4. 2.3 2. 4.1 188.8.131.52 3. The market rose sharply in 2008 Flat products dominating the market New stainless steel making plant under preparations Prepared by Data Consult 10 .Indonesia’s Market for Stainless Steel E MARKET INTELLIGENT REPORT : STAINLESS STEEL IN INDONESIA LIST OF CONTENTS Page Executive Summary viii CHAPTER I – INTRODUCTION CHAPTER II – MARKET BACKGROUND 2.
2. 6. 184.108.40.206.BAR AND WIRE 6. Product description and trade classifications Market overview Development of imports of tubular products SS 304 dominating tubular markegt Paper and automotive component industry the major users Key overseas suppliers Prepared by Data Consult 11 . 5.4 7. Trade classification Market overview Two cold rolling mills in operation Imports fluctuated with strong upward trend 33 34 36 39 39 44 46 48 55 5. 6.3. 220.127.116.11. 5. 6. 7. 5. 18.104.22.168. Trade classifications Market overview Strong imports since 2005 Market dominated by SS 304 grade End users importers have significant role Key overseas suppliers 60 62 64 65 67 72 77 77 80 81 82 83 84 CHAPTER VII STAINLESS STEEL TUBULAR PRODUCTS 7. Hot rolled flat stainless steel dominating the market 5. 7.6.STAINLESS STEEL ROD. 5. Singaore became the largest exporter to Indoensia 5. Imports dominated by grade 300 and 200 series of stainless steel Cold rolling millers the largest importer Key overseas suppliers CHAPTER VI. 22.214.171.124.1.FLAT STAINLESS STEEL 5.Indonesia’s Market for Stainless Steel Page CHAPTER V .126.96.36.199.6. 7.1.
5.5. 10.STAINLESS STEEL FLANGES AND FITTINGS 8. 10. 10.1. 10. PT Sunstar Engineering Indonesia PT Kingfurn International PT Steel Pipe Industry of Indonesia (SPINDO) PT Nayati Indonesia PT Heisei Stainless Steel Industry PT Metalina Tunggal PT Alam Lestari Unggul CHAPTER XI – PROFILE OF MAJOR TRADERS OF STAINLESS STEEL 11. 188.8.131.52 PT Sutindo Raya Mulia Prepared by Data Consult 12 .2. 9.6.3. 8.4.1 8. 10.4. 8.7. Flat products Rod. 9.Indonesia’s Market for Stainless Steel Page 80 CHAPTER VIII .4. 9.2 8. bars and wires Stainless steel tubular products Stainless steel flanges and fittings Summary of the market segments CHAPTER X – PROFILE OF MAJOR END USERS OF STAINLESS STEEL 10. Product desctiptions and trade classification Market overview Development of imports Specification of tubes imported Endusers are direct importers Key overseas suppliers 89 90 91 92 97 99 101 101 102 104 105 106 112 112 113 114 117 119 122 124 127 127 CHAPTER IX – MARKET SEGMENTS OF STAINLESS STEEL 9.3. 9.6.3. 10.5.
2002-2007 Development of market size of stainless steel in Indonesia. 2. 2. 5.6.5. 2.2. 2005-2008 GDP and other key economic indicators. 2008 Development of Indonesia/s import volume of flat stainless steel. 2002-2008 Economic growth outlook by sector Composition of GDP at current market price by sector. 2001-2008 27 28 35 37 38 86 40 42 12 Page 5 7 9 10 Prepared by Data Consult 13 . import and export of flat stainless steel.4. 5.6. 5. GDP growth and distribution by expenditures. 12.2 11. 4. Concluding summary Recommendations LIST OF TABLES No 2. 2.3. 2001-2008 Development of Indonesia/s import value of flat stainless steel. 5. 2002-2007 Share of construction value completed by ICA by type of consutruction works.2. 4.5. 2004-2008 Construction value completed by ICA by type of construction work. 2.3 PT Angkasa Perindo Sakti PT Dihen Bersama 135 139 143 143 147 CHAPTER XII – CONCLUSIONS AND RECOMMENDATIONS 12. 184.108.40.206. 20012008 Market size.3.2.2. 2001-2008 Producers of stainless steel coil/ plate as recorded by the ministry of Industry Specifications of products of domestric stainless steel producers Stainless steel coil/plate production by company and grade.Indonesia’s Market for Stainless Steel Page 11. 20012008 Development of market value of stainless steel in Indonesia. 5.4.1.
3.Indonesia’s Market for Stainless Steel 5. Selected imorters of SS316 5. 2006 6. 2006 45 46 49 51 52 53 55 56 64 65 66 68 69 70 71 73 74 81 83 85 86 91 5. 20012008 Structure of flat stainless steel improts.10.8.7. 2001-2008 Importers of stainless steel tubulars by grade.14. 2006 5. traders 5.4. 20012008 Imports of stainless steel bars and wires by grade. 6. 2006 Imports of stainless steel barfs and wire products of SS 304 grade by trading companies Suppliers of stainless steel bars and wires.9. 2006 Main suppliers of stainless steel tubulars and their importers.9.7 5.1. Importers of SS400 series of flat stainless steel and their imports. 6.11. 20012008 Import value development of stainless steel bars and wires. 6.2.4. 8.5.8 5. Import volume development of stainless steel bars and wires. 2006 Country of origins and main suppliers of stainless steel bars and wires.1. 2006-2008 Importers of SS 304 flat stainless steel. 7. 2008 Main importers of stainless steel bars and wire products of SS 304 grade. 2006 Import development of stainless steel tubularf products. 2006 Main importers of stailess steel bars and wire products of Special grade . by grade. 7. 6. Overseas suppliers of flat stainless steel products. Imports of flat stainless steel by main countries of origins.3. 7.6. 6.12. 2006 Main importers of stailess steel bars and wire products of SS 316 grade. 6.2. Counries of origin and ain suppliers. 7. 6.1. 2006 5. 6. 2006 Main suppliers of tubulars and countries of origin. 2006 Import development of stainless steel tubuars.13. 2001-2008 Prepared by Data Consult 14 . Size ofstainless steel coil and plate imported by selectd end users.
Specification of stainless steel imported by PT Sutindo Raya Mulia 11.7. Specification of stainless steel used by PT Kingfurn International 10. 9.Indonesia’s Market for Stainless Steel 8.5. 9.5. 9.000 in 2006 Other main sjuppliers of stainless steel fittings and flanges. 2007 Market segments of stainless steel bars and wires Market segments of stainless steel tubulars. 9. Page 28 Prepared by Data Consult 15 . 9.4. 9.1. 9. 2007 Summary of market segments of stainles steel in terms of value 2007 Importers of stainless stel buy market segments Specification of stainless steel used by SPINDO 92 98 99 100 101 103 104 106 107 108 109 110 113 115 118 120 123 125 127 136 139 10. Development of market volume and value of stainless steel.2.1.3. Specification of stainless steel used by PT Nayati Indonesia 10.3.6. Specification of stainless steel used by PT Heisei Stainless Steel Industry 10.1.1. with export value more than US$ 100. Specification of stainless steel used by PT Alam Lestari Unggul 11. 9.6.3. 8. 2007 Type of stainless steel used bhy selected industrial users Summary of market segments of stainles steel in terms of volume.3 Specification of stainless steel imported by PT Dihen Bersama LIST OF GRAPHS/ CHARTS No 4. 8.4. Specification of stainless steel imported by PT Angkasa Perindo Sakti 11. 10. 2006 Market segment of flat stainless steel.2 Type of products imported by selected end users Main imporers of stainless steel fittings and flanges Suppliers of stainless steel fittings and flanges.2.5. Specification of stainless steel used by PT Metalina Tunggal 10. 2007 Market segments of stainless steel fittings and flanges.7. 8.4.2.
1. 6. 9. 4.2.3. 9. 5. 9. 2. 2001-2008 Import of flat stainless steel by grade. import and export of flat stainless steel.2.1. 2001-2008 Market segmentation of flat stainless steel Market segmentation of stainless steel bars and wires Market segmentation of stainless steel tubulars Market segmentation of stainless steel fittings and flanges Summary of marke segments of stainless steel 82 91 102 103 105 105 109 29 30 30 31 35 44 47 APPENDICES 1.Indonesia’s Market for Stainless Steel Indonesia. 2001-2008 Market structure of stainless steel bars and wires by grade Market structure of stainless steel tubular by grade The market of stainless steel fittings and flanges. Market structure by type of products ( in volume). 20012008 Market development . 220.127.116.11.4.2. 2008 Development of market volume of stainless steel in Indonesia by type of products.com to obtain the full report.1. 9. 4. 2001-2008 Per capaitaq consumption of stainless steel in Indonesia.2. 7.5. 6. 9. 2001-2008 Development of import volume and value of flat steel.3. 8. 5. 2001-2008 Development of market valueof stainless steel in Indonesia by type of products. 2001-2008 4.3. Prepared by Data Consult 16 . 4. 2006-2008 Market size ( import) of stainless steel bars and wires.5. Directory of stainless steel traders Directory of stainless steel industrial users 149 163 Please email to survey_dataconsult@yahoo.
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