Gapipa charges China, KL with dumping steel

Gapipa charges China, KL with dumping steel

JAKARTA (JP): The Indonesian Steel Pipe Association (Gapipa) has proposed the government impose countervailing duties on steel pipe imports from Malaysia and China.

Gapipa's secretary-general Untung Yusuf claimed on Friday that the association had found that the two countries' pipe producers had dumped their products during the pipe auction of state gas distributor Perusahaan Gas Negara (PGN) last month.

At the bidding, he said, Malaysian company Hicom Petropipes offered PGN a cost, insurance and freight to Batam price of US$430 a ton for API 5LX-65 pipes, 63 percent below the company's price of $700 a ton in Malaysia.

Chinese participant PT Sahanxi Machinery & Equipment offered the same pipe at $460 a ton CIF Batam, 65 percent below its price of $740 a ton in China, he added.

He said that the association had filed a complaint with the Indonesian Antidumping Committee (KADI) and that the government- sponsored agency was investigating the charge.

"We hope the government will take this matter seriously, otherwise the local steel pipe industry will collapse due to its inability to compete with foreign companies," he said, adding that local pipe companies now employed about 10,000 workers.

Untung said should the Malaysian and Chinese firms continue to offer steel pipes at those prices in the next phase of the PGN tender, it would be almost impossible for local companies to compete with them.

Last month, PGN tendered a contract for steel pipes for its 71-kilometer gas pipeline project from Sakernan to Kuala Tungkal in central Sumatra.

The tender will be followed by a tender for the supply of pipes for a pipeline linking Kuala Tungkal to Batam, according to Untung.

Both pipelines are part of PGN's giant project to develop gas pipelines connecting Jambi, Batam and Singapore.

The planned 460-kilometer pipeline will require about 120,000 tons of steel pipes, he said.

He also said that aside from the imposition of antidumping duties requested, the association planned to propose the government impose countervailing duties on steel pipes from India, Brazil and European countries.

He also urged the government to remove the current free import duty policy on steel pipes for state oil and gas company Pertamina projects to help the ailing industry grow.(05)