Japan’s NSSMC halts exports of CRC to Indonesia

Nippon Steel & Sumitomo Metal Corp (NSSMC) has stopped exporting its cold rolled coil to Indonesia this month in light of the anti-dumping action taken by the Indonesian government.

Paragraph entered by Atlantic migration, in order for SteelFirst articles to display correctly on Metal Bulletin.

The Japanese steelmaker, a major exporter of the flat product to Indonesia, is seeking the help of the Japan External Trade Organization to negotiate with the Indonesian government on reducing the anti-dumping duty, a source familiar with the situation said.

Japan is the largest source of imported CRC into Southeast Asia, according to data from the Southeast Asia Iron & Steel Institute. However, imports from Japan last year saw a moderate decline of 7% year-on-year while imports from China soared by 20%.

NSSMC’s CRC exports to Indonesia are mainly for re-rollers – mostly joint ventures between local investors and Japanese trading companies – who reproduce them into coated sheet and stainless steel, the source said.

These coated sheets are used in the automotive industry as well as other steel-consuming industries in Indonesia, such as the electrical appliance manufacturing sector.

Indonesia imports about 30% of its CRC requirements from overseas, with the rest supplied by domestic producers, the source said.

Many Japanese car manufacturers have moved their production bases to Indonesia from Thailand after severe flooding in the latter country in 2011. This is a key reason for the increased imports of CRC into Indonesia, the source said. The Thai flooding had affected a raft of Japanese firms at the time, but Indonesia is also considered attractive because of its low labour costs and growing car demand.

Last week, the Indonesian government signed a regulation to impose anti-dumping duties on imports of CRC from Japan, China, South Korea, Taiwan and Vietnam for a period of three years in a bid to protect local producers.

The tax will be levied in a range between 5.9% and 55.6%, with shipments from NSSMC subjected to the highest duty, according to local media reports.

Last December, the Japan Iron & Steel Federation (JISF) had criticised the conclusions of an Indonesian anti-dumping investigation into CRC imports as “unjust and extremely regrettable”.

The Indonesian Anti-Dumping Commission had ruled that CRC and sheet from Japan had caused injury to domestic producers, and recommended that the country’s trade ministry put in place anti-dumping duties.

“Cold-rolled steel coils/sheets from Japan are clearly vital to Indonesia’s automobile industry and other steel-consuming industries in Indonesia.

“If anti-dumping measures are taken, we believe there would be an enormous negative impact on the Indonesian economy,” JISF chairman Hiroshi Tomono had said at the time. Tomono is also the president and coo of NSSMC.