Authors :
Rizky Aditya Wijaya
Volume/Issue :
Volume 8 - 2023, Issue 10 - October
Google Scholar :
https://tinyurl.com/4v9yfx6d
Scribd :
https://tinyurl.com/u7xj6jzn
DOI :
https://doi.org/10.5281/zenodo.10081407
Abstract :
The steel industry in Indonesia has undergone
substantial growth, driven by the expansion of the
national infrastructure and construction sector.
However, this sector faces multifaceted challenges,
including escalating raw material prices, elevated energy
and transportation expenses, and intense competition
from imported steel. The emergence of the COVID-19
pandemic further disrupted the steel supply chain and
reshaped demand patterns. The ease of access to
international steel products in the domestic market
significantly influences the utilization of domestically
produced steel. To foster sustainable and competitive
growth, the Indonesian Government has instituted
various policies and regulations for industry
improvement. Although there is potential for sustainable
growth in the national steel industry, it is imperative to
acknowledge and effectively address the prevailing
dynamics and challenges. This research endeavors to
provide a comprehensive analysis of the steel industry,
specifically focusing on the sheet steel segment in
Indonesia. Employing system dynamics simulations, this
study seeks to estimate the trajectory of developments,
challenges, opportunities, and shifts in the supply and
demand for domestic sheet steel products. Four dynamic
hypotheses within the system are proposed and
rigorously examined. The current model structure
suggests that augmenting steel mill capacity and
introducing regulations on steel product imports lead to
an upsurge in domestic flat steel production.
Furthermore, providing tax incentives and tariff
adjustments presents a promising avenue for mitigating
price differentials between flat steel and its raw
materials within the country. The findings of this
research hold the potential to provide valuable insights
for policy recommendations aimed at propelling the
progress of the flat steel industry in Indonesia.
Keywords :
Flat Steel Industry, Steel Production Supply and Demand, Dynamic System Simulation, Tax Incentives, Industrial Competitiveness.
The steel industry in Indonesia has undergone
substantial growth, driven by the expansion of the
national infrastructure and construction sector.
However, this sector faces multifaceted challenges,
including escalating raw material prices, elevated energy
and transportation expenses, and intense competition
from imported steel. The emergence of the COVID-19
pandemic further disrupted the steel supply chain and
reshaped demand patterns. The ease of access to
international steel products in the domestic market
significantly influences the utilization of domestically
produced steel. To foster sustainable and competitive
growth, the Indonesian Government has instituted
various policies and regulations for industry
improvement. Although there is potential for sustainable
growth in the national steel industry, it is imperative to
acknowledge and effectively address the prevailing
dynamics and challenges. This research endeavors to
provide a comprehensive analysis of the steel industry,
specifically focusing on the sheet steel segment in
Indonesia. Employing system dynamics simulations, this
study seeks to estimate the trajectory of developments,
challenges, opportunities, and shifts in the supply and
demand for domestic sheet steel products. Four dynamic
hypotheses within the system are proposed and
rigorously examined. The current model structure
suggests that augmenting steel mill capacity and
introducing regulations on steel product imports lead to
an upsurge in domestic flat steel production.
Furthermore, providing tax incentives and tariff
adjustments presents a promising avenue for mitigating
price differentials between flat steel and its raw
materials within the country. The findings of this
research hold the potential to provide valuable insights
for policy recommendations aimed at propelling the
progress of the flat steel industry in Indonesia.
Keywords :
Flat Steel Industry, Steel Production Supply and Demand, Dynamic System Simulation, Tax Incentives, Industrial Competitiveness.
