What construction, factories and almost all industries have in common is that none can exist without the iron and steel industry. Joint-venture steelmaker KRAKATAU POSCO has thereby made it a goal to provide Indonesia's technology-based sectors with premium-quality, clean steel slabs and plates.
KRAKATAU POSCO is 70 per cent owned by South Korean firm POSCO, one of the world's largest steelmakers, and 30 per cent by Indonesia's state-owned steelmaker, Krakatau Steel. POSCO's arrival in Indonesia brought along the introduction of upstream technologies such as blast furnace and converter process.
"We use the oxygen converter to make clean steel for high-end use," says president Min Kyung-zoon. "The slabs are for hot rolling, while the plates are for shipbuilding, construction and heavy machining."
POSCO's manufacturing excellence defines the KRAKATAU POSCO venture, which achieved its first production phase in December last year. This translates to a capacity of 3 million tonnes per year, reinforcing the venture's ability to supply the Indonesian market with high-grade steel at competitive prices.
Last year, the Indonesian market imported about 7 million tonnes of steel from China, South Korea and Japan. "If we produce highly competitive materials locally, we can cover the domestic steel market and reduce imports," Min says.
POSCO tapped into Indonesia because of the host country's potential, given its steady economic growth rate and growing population of more than 250 million. As KRAKATAU POSCO propels itself to play an important role and contribute significantly to the local iron and steel market, it is also committed to train Indonesian operators and support the development of local industries.
