JFE Steel, the Japanese steel producer, says it will invest about $300M to build a galvanising line in West Java to accommodate increasing demand for high-end steel products for use in cars in the local market.

The company, a unit of JFE Holdings, said it would build a continuous galvanizing line (CGL) in an industrial estate in Bekasi about 30km east of Jakarta. The location will be adjacent to several automotive manufacturers.

The line will have a capacity of 400kt/y of galvanized steel sheet, and is expected to begin operations in March 2016. This will be JFE’s third CGL for automobiles in Asia outside Japan, following plants in China and Thailand.

Indonesia is Southeast Asia’s largest economy and the region’s second largest automobile producer after Thailand.

Local demand for high-end automotive steel sheet is expected to grow as automakers expand capacity in line with the expected car sales of more than 1.1 million units this year, almost unchanged from 2012.

JFE Steel is affiliated with JFE Shoji, which imports and exports steel products and trades in the raw materials for steel, non-ferrous metals, chemicals, machinery and ships. The company has international operations and networks throughout Asia.

Source: Daily ‘The Jakarta Globe’, Jakarta; 17 June 2013