Indoferro to spend $100 million for smelting expansion

PT Indoferro plans to spend up to US$100 million to expand the company?s steel smelting plant in Cilegon, Banten to meet a growing demand for pig iron from the domestic market, Bisnis Indonesia reported on Tuesday.

Fadjar Suhendra, CEO of Growth Steel Group, the parent company of Indoferro, said in Jakarta on Monday that the additional investment was expected to increase production capacity of pig iron from 550,000 tons a year at present to 1.1 million tons a year in 2014.

He said that the demand for pig iron rose significantly in recent months due to the decline in the supply of iron scrap. The seizure of a number of containers of imported scraps in the Tanjung Priok port recently had partly contributed the sharp increase in the demand, he added.

Fadjar said that the demand for pig iron in Indonesia reached 500,000 tons a year. The increase in the production will enable Indoferro to export part of its production.(*)