Krakatau Steel says jv to import 5 mln tonnes/yr iron ore

JAKARTA Aug 14 (Reuters) - Indonesia's biggest steel maker, PT Krakatau Steel, said late on Friday it plans to import 5 million tonnes of iron ore a year from 2013 when its joint venture with South Korea's POSCO (005490.KS: Quote) starts production.

Wawan Hermawan, a spokesman for Krakatau Steel, said the new production plant would import iron ore from Latin America, including Argentina, because Indonesia's domestic supplies were insufficient.

"When the first phase of the steel production joint venture between Krakatau Steel and POSCO start operations in 2013 with a capacity of 3 million tonnes a year, we will need 5 million tonnes of iron ore a year," said Hermawan.

He said the plant would produce steel plate which would be sold to Indonesian shipyards and auto manufacturers.

POSCO, the world's No. 3 steelmaker, signed the joint venture agreement with Krakatau Steel earlier this month.[ID:nJAK257787]

Krakatau Steel is set to hold an initial public offering on November 10, and aims to raise as much as 3.5 trillion rupiah ($390.4 million). [ID:nJKB003861] ($1 = 8,965 rupiah) (Reporting by Yayat Supriatna; Writing by Telly Nathalia; Editing by Sara Webb)