Casting Producers Suffering: Yogyakarta, Central Java, Indonesia

By Barrie | January 10th, 2007 | No Comments

Small-scale aluminum casting producers in Yogyakarta are on the brink of collapse, losing out to a boom in Chinese products and handicapped by limited access to capital as Slamet Susanto reports.

Yogya companies losing out to cheaper Chinese products

The industry produces kitchen utensils such as pots, pans and woks, as well as sports-styled wheels for cars.

The chairman of the Yogyakarta Aluminum Casting Association, Beni Hendra, called on the government to help through protective measures and other steps.

“Our innovative products, such as aluminum sports rims, have lost in competition with Chinese products due to their cheaper prices. This needs serious attention from the government,” said Beni.

He added that local aluminum casting companies had trouble expanding because they typically found it difficult to get bank loans. As a result, 80 percent of the 65 companies in the area are now in critical condition.

“We hope bank loan procedures will be simplified so that we can expand our businesses,” said Beni.

He also suggested the government help them with training programs so that they could acquire the necessary knowledge and skills to compete in the global market.

Yogyakarta Governor Sri Sultan Hamengkubuwono X, when handing over Rp 350 million (US$39,000) in assistance to revive the industry recently, urged aluminum casting producers in Yogyakarta to continue improving the quality of their products.

“We hope that aluminum products from Yogyakarta are able to meet quality standards, from raw materials to the finishing process, in order to flourish and absorb the local workforce,” he said.

He encouraged the companies to use technology to make the production process more precise and to track their businesses carefully in order improve their performance against the competition.

Slamet Susanto