Indonesia's steel industry has shown remarkable performance by securing the 4th position globally. This achievement marks a significant leap for Indonesia, considering the fierce competition in this industry. With the increasing demand for steel in various sectors such as construction, automotive, and manufacturing, Indonesia's steel industry has become a crucial contributor to national economic stability. In 2023, Indonesia's steel export value reached USD 26.70 billion, a staggering 261.49% increase from USD 7.39 billion in 2019.

Key Point

• Indonesia now stands 4th globally in steel exports, a significant rise from its 17th position in 2019
• Efforts include facilitating entry into international markets via Free Trade Agreements (FTA), Preferential Trade Agreements (PTA), and Comprehensive Economic Partnership Agreements (CEPA) with Canada and the European Union, alongside broadening non-conventional markets

"Baja (steel) has become Indonesia's flagship export. Steel continues to be a key commodity for infrastructure development and drives domestic manufacturing, such as the Nusantara Capital (IKN) project. On the other hand, the steel industry plays a pivotal role in maintaining economic stability," said Minister of Trade Zulkifli Hasan during the National Seminar and Exhibition on Steel Construction Supply Chains, and the National Working Meeting (Rakernas) III of the Indonesian Society of Steel Construction (ISSC) in Jakarta on Wednesday, July 10, 2024.

Read More: Freeport Copper Smelter in Gresik Officially Begins Operation, Becoming the Largest in the World

Courtesy Source: Ant Rozetsky on Unsplash

Rapid Growth in the Past 5 Years

Indonesia's iron and steel industry has experienced rapid growth in the last five years (2019 to 2023). Currently, Indonesia ranks 4th globally as a steel exporter, up from 17th place in 2019. In 2023, Indonesia's steel exports totaled USD 26.70 billion, a 261.49% increase from USD 7.39 billion in 2019. The country's steel imports amounted to USD 11.38 billion in 2023, resulting in a trade surplus of USD 15.32 billion.

National steel consumption is estimated to reach 18.3 million tons in 2024, growing by 5.2% compared to the previous year. This growth is driven by various factors that stimulate steel demand.

“Indonesia is also actively developing infrastructure and promoting manufacturing industries, such as the construction of IKN, infrastructure development, and automotive industry expansion. There are at least 41 strategic national priority projects targeted for completion by 2024,” Zulkifli Hasan stated.

Supported by Export Strategies and Policies

Various strategies and policies have been implemented to support Indonesia's national export growth. Efforts include opening access to foreign markets through Free Trade Agreements (FTA), Preferential Trade Agreements (PTA), and Comprehensive Economic Partnership Agreements (CEPA) with Canada and the European Union, as well as expanding non-traditional markets.

“On the other hand, the Ministry of Trade continues to protect and promote the domestic steel industry. Measures include restricting imports of certain iron and steel products, promoting value-added exports through steel product downstreaming, and monitoring steel imports to ensure compliance with established regulations,” Zulkifli Hasan emphasized.

Zulkifli Hasan also noted that Indonesia's iron and steel industry faces trade restrictions from other countries, including trade remedies and the Carbon Border Adjustment Mechanism (CBAM) policy.

Nevertheless, Indonesia has significant opportunities to overcome these trade barriers. For instance, Indonesia has successfully exported 160 tons of high-tech steel products worth USD 195,000 to destinations including Australia, Canada, and Puerto Rico.

Courtesy Source :

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https://www.goodnewsfromindonesia.id/2024/07/15/ekspor-baja-indonesia-peringkat-ke-4-dunia-berkembang-pesat-sejak-5-tahun-terakhir