Steel Pipe - Photo by Hebei

JAKARTA (TheInsiderStories) – The Indonesian government is committed to improving the steel industry by reviewing export and import cooperation with Malaysia and Australia. Starting Feb. 9, Malaysia no longer imposed Anti-Dumping Import Duty on the import of Hot Rolled Coil (HRC) steel products from Indonesia.

State-owned steel producer, PT Krakatau Steel Tbk (IDX: KRAS) was initiated the trade deal between Indonesia and Malaysian Ministry of International Trade and Industry since August 14, 2018 ago.

“The deal is valid for five years, from February 2015 to February 2020. However, in its development the Malaysian domestic industry as an applicants has experienced internal problems, thus stopping the overall production of HRC,” said Director General of Foreign Trade Oke Nurwan on Jan. 12.

Since 2016, he added, Malaysia is no longer able to supply HRC to the domestic market. However, said Nurwan, Malaysia has complied their own laws and regulations.

Reportedly, the imposition of Anti-Dumping Import Duty (ADID) on Indonesia’ HRC products has disrupted the performance of the country’ exports to Malaysia. Prior to the imposition, in 2014 HRC exports from Indonesia to Malaysia had posted a value of US$30 million, fell to $8.6 million in the first year of imposition. In fact, during the first three quarters of 2018 the export fell to $92,000.

Meanwhile, the Australian Government did not continue the process of reviewing the imposition of ADID of 8.6-19 percent on imports of Hot Rolled Plate (HRP) steel products from Indonesia which were effective from Dec. 19, 2013.

In accordance with the provisions of the anti-dumping agreement, the imposition of the rule may only be valid for a maximum of five years unless extended, so the imposition of the ADID has expired on December 19, 2018.

“We have traced the official website of the Australian Authority and found no further steps from the authority to extend BMAD after Dec. 19, 2017 or exactly a year before BMAD ended, so that according to the Anti-Dumping Agreement, the imposition of BMAD ended on Dec. 19, 2018,” he explained.

Previously, HRP’ export to Australia in 2012 before the imposition of ADID was recorded at $32 million. The export value continues to fall to reach $1.2 million in the nine months period of 2018.

“It is expected that both the termination of ADID by Malaysia and Australia can be utilized by national steel exporters to restore the export performance affected due to ADID over the past few years,” he concluded.

Written by Daniel Deha, Email: daniel@theinsiderstories.com

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