Indonesia: production and export leap in 2018
The World Bureau of Metal Statistics (WBMS) now has extensive 2018 trade data for stainless steel. In that year WBMS estimates that Indonesia produced 2.2 Mt of stainless slabs or 4% of global production. Compared to 0.6 Mt in 2017 this represents a near four-times increase: an important consideration as production is expected to continue to increase strongly. And as mentioned in a previous ‘stats corner’, production in Indonesia tends to be ‘low cost’.
Article by WBMS' Peter Cranfield
Image courtesy of Nick Youngson CC BY-SA 3.0 Alpha Stock Images
Chart 1 shows Indonesian exports by shape. Exports increased from 691kt in 2017 to 1.9 Mt in 2018, more or less in line with the production increase. Roughly two thirds of total exports were HR coils and nearly 30% slabs. In other words exports were nearly all for rerolling in the country of destination. The hot rolled coils will be rolled into flat products, the majority of which are cold rolled sheet and strip.
Chart 2 shows the same exports by destination where they will be re-rolled for the most part. Half the exports are shipped to China and 20% to Taiwan. 4% are destined for both Italy and USA and most of the rest to Asia. In addition to the dramatic rise in stainless exports there was a four-fold increase in nickel oxide ores to China from around 4.7 Mt in 2017 to 19.3 Mt in 2018. This allowed a large increase in nickel pig iron (NPI) production in China. This in turn allowed China’s stainless slab production to increase from 25.7 Mt in 2017 to 26.7 Mt in 2018 (+4%).
Chart 3 shows imports by shape. These increased by some 5% to 423 kt in 2019, so Indonesia had a massive stainless export surplus of some 1.5 Mt. The largest single category was CR flat, which is probably for fabrication in Indonesia. Slabs at 59 kt and HR coils at 97 kt were little changed from the previous year.
Chart 4 shows imports by country. Nearly all imports are from Asia with China accounting for 30%, India 20%, Japan 13%, Singapore 12% and 6% each from Taiwan and S. Korea. Of course the essential alloying raw material needed for stainless steel is chrome. Chrome ore imports increased from 272 kt in 2017 to 353 kt in 2018 (+30%) mainly from South Africa. This is converted to ferrochrome. As reported previously some of the liquid ferrochrome is charged directly to the argon-oxygen converter (AOD) bypassing the electric arc furnace (EAF) and thereby generating substantial energy cost savings.
Meet the Author: Peter Cranfield, WBMS
Peter Cranfield has a BSc (Econ) from London University and an MBA from Warwick. He started his career at Inco serving as market research manager and also producing the annual publication World Stainless Steel Statistics (in 1986 taken over by WBMS). Later he joined Shell-owned Billiton in The Hague for 15 years working in a number of metals and industrial minerals as well as strategic planning. Peter then moved back to London with BHPBilliton working in business planning and analysis in nickel, cobalt and stainless. He has regularly delivered presentations on nickel and stainless at conferences around the globe. Since retiring he has consulted for BHPB, Nickel Institute and now the UK-based World Bureau of Metal Statistics.