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According to Mining News Pro - Rising prices of global steel has prompted listed Indonesian steel maker, PT Gunawan Dianjaya Steel, to look for suppliers at home, Bisnis Indonesia reported on Thursday, Aug. 23.

Hadi Sutjipto, the company’s finance director, said the company still sourced all of its raw material from overseas suppliers in the first six months of this year. But it’s looking into buying from local producers.

“Since Jan. 1, 2017, global steel prices have increased by nearly 20 %. Maybe it’s around 8% year-to-date. The uptrend is intact so it’s better if we have local sippliers,” said Hadi to Bisnis.

Hadi, as quoted by Bisnis Indonesia, said rising crude prices have also increased prices of other commodities, including steel.

The company was looking into buying raw material from PT Krakatau Posco but slate production at PT Krakatau Posco is only enough for internal use, Hadi said as quoted by Bisnis Indonesia.

However, the company will still maintain discussion with Krakatau Posco and other potential local suppliers that can provide raw material for Gunawan Dianjaya Steel.

PT Gunawan Dianjaya has hot-rolled steel mills, producing steel plates for general use (structural plates) and ship buildings. Its plate mill in Surabaya, in East Java, has the capacity to process 450,000 tons of slab annually, which started operation in 1992, according to the company’s data.

The company announced on June 7, it plans to merge with another steel company, PT Jaya Pari Steel (JPRS) to improve efficiency as both are owned by the same owner, Gwie Gunawan, and have similar businesses.

In the first six months of this year, PT Gunawan Dianjaya booked 604.24 billion rupiah (US$41.35million) of revenue, down from 605 billion rupiah. Sales in local market accounts for nearly 97 percent of its total revenue. The remaining 13 percent was from exports to Asia and Europe