A new entrant to the People’s Republic of China’s aluminium sector is planning a 1 million metric ton per annum aluminium smelter for Indonesia.
According to a report by CRU, Tsingshan Holding Group is planning to enter the field by building the new aluminium smelter in conjunction with Huafon Group. The firm operates an industrial park in Sulawesi, which is where the smelter is planned.
CRU says Tsingshan would initially produce at a rate of 500 thousand metric tons per annum by 2023, but they did not specify when full production would begin.
CRU senior consultant Ying Dai indicated that this may be the first of many new aluminium projects in Indonesia.
“We also think hydropower potential in Indonesia will also bring another opportunity for aluminium smelting development domestically.”
He continued by noting that the firm can leverage Chinese technology and low-cost coal-fired power plants in Indonesia. In addition, the firm would benefit from working outside the capacity limits imposed upon the industry by Beijing.
Tsingshan joins China Hongqiao Group in Indonesia as well as several other Chinese firms currently planning or operating smelters in country. Indonesia is expected to prohibit the export of bauxite ore from the country in a bid to boost its own domestic aluminium production.
Tsingshan currently produces only nickel and stainless steel. It is also planning an entry into the copper sector via a US$2.8 billion copper smelter in Weda Bay, in which it will partner with McMoRan Inc.