The new facility will shift production to Indonesia, one of the world’s fastest-growing markets, following the oversupply in China.
Industry officials stated that the companies plan to build a facility with an annual capacity of 2 million tons in the Morowali Industrial Park on Sulawesi Island. This capacity will be equivalent to South Korea’s total stainless steel output.
Under the agreement, POSCO will acquire a 44.12% stake in PT Xinheng Metal Indonesia, a subsidiary of PT Makmur International Investment PTE owned by Tsingshan. The remaining 55.88% will remain with Tsingshan. The joint venture will manage the plant together.
Construction is scheduled to begin in 2026, with POSCO’s investment expected to exceed 1 trillion won (approximately USD 708 million).
This development follows POSCO’s sale of its 1.1 million-ton stainless steel plant in China to Tsingshan in July. With this move, the South Korean manufacturer has signaled its intention to position Southeast Asia as a strategic hub for stainless steel production.
POSCO also operates Krakatau POSCO, an integrated steel mill in Indonesia that began operations in 2013 with an annual capacity of 3 million tons.
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