The Ministry of Industry (Kemenperin) is actively monitoring the implementation of health protocols and the Operational Permit and Mobilization of Industrial Activities (IOMKI) in a number of manufacturing industry sectors that are classified as critical or essential, especially during the current Level 4 Community Activity Restrictions (PPKM) period.
In addition to encouraging the acceleration of handling and controlling the Covid-19 pandemic, this strategic step is also expected to maintain production activities in the industrial sector, so as to be able to meet the needs of the domestic and export markets.
"This monitoring also socializes the issuance of Circular Letter of the Minister of Industry Number 3 of 2021 concerning Operations and Mobility of Industrial Activities during the Covid-19 Public Health Emergency," said Director General of Metal, Machinery, Transportation Equipment and Electronics (ILMATE) of the Ministry of Industry, Taufiek Bawazier. , while visiting the steel company PT AM/NS Indonesia in the MM2100 area, Cibitung, Bekasi, Monday (26/7/2021).
The Director General of ILMATE emphasized that the steel industry is one of the strategic sectors because its production is used as raw material to support a number of other sector activities. Therefore, the steel industry has an important role or is often referred to as the mother of industries.
"In a pandemic condition, PT AM/NS Indonesia's utility runs 100 percent because it is supported by the export market, including to the United States. Currently, its exports reach 13,000 tons in June 2021, an increase compared to January which reached 2000 tons for CRC and coated steel products. In order to spur the performance of the steel industry sector, we continue to strive to maintain the availability of raw materials and overcome logistical difficulties from shipping companies," said Taufiek.
The Director General of ILMATE appreciates PT. AM/NS Indonesia, which is aggressively exporting amid the impact of the pandemic. "Indonesian steel products are easy to enter America and Europe. Meanwhile, from China, Vietnam and India it is more difficult, because Indonesian steel exports are not subject to trade barriers from European and American markets," he continued.
Furthermore, the Director General of ILMATE also appreciated PT. AM/NS Indonesia as one of the steel industries in the country that applies strict and disciplined health protocols. In addition, the company has implemented the first stage of the Gotong Royong vaccination program which was attended by 397 workers, which is also monitored in the IOMKI report.
"The Ministry of Industry requires all industrial sectors that hold IOMKI to report the operational implementation and mobility of their industrial activities regularly, ie twice a week through the SIINas portal," he said.
Steel Industry Contribution
In addition, the steel industry has so far made a significant contribution to the national economy, starting from an increase in investment, employment, to the contribution of its export value. In the first quarter of 2021, the basic metal industry, metal goods, non-machinery and equipment as the largest contributor group to investment in the manufacturing sector with a value of Rp 27.9 trillion (contributing 12.7 percent).
Next, in January-March 2021, the export value of the base metal industry was recorded at USD 5.87 billion, an increase of 7 percent compared to the achievement in the same period last year which reached USD 5.48 billion. "This means that the steel industry continues to make a large contribution to foreign exchange earnings, especially in the downstream process or increasing the added value of domestic raw materials," said Taufiek.
Even though in the midst of the impact of the Covid-19 pandemic, demand for steel products in the export market increased until the first quarter of this year in line with construction activities. The Ministry of Industry also continues to encourage the increase in the use of steel products in the country, because construction development in Indonesia is still ongoing.
Taufiek said that almost all countries experienced a decline in steel production in 2020 due to the impact of the pandemic. However, this did not happen in several countries, such as China, whose production actually increased by 5.2 percent. Next, steel production in Turkey increased 6 percent, Iran increased 13 percent, and Indonesia was able to increase by 30.25 percent compared to 2019.
As for the capability of the national steel industry, the current national steel raw material production capacity (slab, billet, bloom) is more than 13 million tons with an estimated 2020 production of 11.6 million tons, an increase of 30.25 percent compared to 2019 which reached 8.9 million tons. million tons. In addition, utilization in 2020 also increased to 88.38 percent from 67.86 percent in 2019.
"The steel industry sector is an indicator of a country's economy. It means that if the steel industry grows, of course our economy can be built strongly. In addition, what is important is that we have to optimize domestic products," he said.
In line with the import substitution policy of 35 percent in 2022 initiated by the Ministry of Industry, Indonesia succeeded in suppressing steel imports by 34 percent last year compared to previous years.
