Adaro's KIPI aluminium smelter ramps up for full production by early 2026

Published: Mar 28, 2024 11:00

Save

Amidst the country's lack of sufficient smelters to drive the downstream aluminium sector, Adaro Minerals aims to commence production of 250,000 tonnes of aluminium ingots by the third quarter, with plans to ramp up to full production by early 2026 at its smelter in KIPI, operated by its subsidiary Kalimantan Aluminium Industry.

About the smelter

A US$2 billion aluminium smelter, constructed in Kalimantan Industrial Park Indonesia (KIPI) by PT Adaro Minerals, a coking coal subsidiary of PT Adaro Energy, is set to be fully operational by the first quarter of 2026.

Wito Krisnahadi, director of Adaro Minerals' subsidiary Kalimantan Aluminium Industry, stated that the company intends to sell the smelter's aluminium ingots to domestic and export markets. This move is in response to local demand, which Krisnahadi described as "not that substantial," indicating that it cannot absorb 100 per cent of the output.

250,000 tonnes of ingots

He mentioned that by the third quarter of this year, he anticipates the aluminium smelter will produce 250,000 tonnes of ingots, half of its installed capacity of 500,000 tonnes. Adaro's unit plans a $1.1 billion capital expenditure, primarily allocated for the smelter.

According to Wito, the ingots are part of the government's strategy to advance the downstream aluminium industry. These ingots can be used to create value-added products such as billets, rods, automotive components, and food packaging. Adaro Minerals is currently concentrating on ensuring a consistent, round-the-clock electricity supply for the smelter operation in Bulungan, North Kalimantan.

Source: https://www.alcircle.com/news/adaro-s-kipi-aluminium-smelter-ramps-up-for-full-production-by-early-2026-110281

Market forecast Market review

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

29 mins ago

Aluminum Futures Fell for Consecutive Days, Trading Atmosphere Sluggish [SMM Spot Aluminum Midday Commentary]

29 mins ago

52 mins ago

Aluminum ADC12 Import Prices Drop, Domestic-Ex-China Gap Narrows to 2,300 Yuan/mt

[SMM aluminum flash] Current import ADC12 prices have pulled back to $3,230–$3,300/mt, and the domestic-ex-China inversion gap has narrowed to around 2,300 yuan/mt, the lowest level since mid-March. As prices outside China soften, import losses have recovered markedly from the earlier period. However, constrained by the still-large inversion, the import window remains closed. The willingness to bring in overseas resources is limited, and in the short term, their incremental supplement to domestic supply remains weak.

52 mins ago

53 mins ago

Domestic ADC12 Market Stable, SMM Price Unchanged at 23,850 Yuan/mt Amid Bearish Sentiment Easing

[SMM Aluminum Alloy Daily Review] Domestic ADC12 market saw stable operation today, with the SMM ADC12 price unchanged from the previous day at 23,850 yuan/mt. The bearish sentiment caused by the steady decline earlier eased, and the market entered a phase of wait-and-see. Demand side, orders at downstream die-casting enterprises remained insufficient, with off-season features persisting, which to some extent constrained price rises. Cost side, procurement of compliant aluminum scrap remained challenging, tax invoice and raw material costs stayed high, squeezing profit margins at secondary aluminum enterprises but providing strong bottom support for ADC12 prices.

53 mins ago