Backdrop & Context
Indonesia is among the world's most seismically active nations, with over 17,000 islands scattered along the Pacific Ring of Fire. This geological belt accounts for 90% of the world’s earthquakes and 81% of the largest ones. In 2025 alone, Indonesia has recorded over 500 earthquakes with a magnitude of 4.0 or more. The vulnerability of Southeast Asia’s infrastructure was dramatically highlighted last month when a magnitude 7.7 earthquake struck Myanmar, leading to the collapse of a 33-story skyscraper under construction in Bangkok. This tragedy accelerated demand for building materials capable of resisting seismic shocks.
Seismic safety has transitioned from a niche concern to a central requirement in modern construction codes. Government agencies across ASEAN are now mandating earthquake-resilient infrastructure for urban development, pushing steelmakers to innovate.
Who’s Involved?
South Korea’s POSCO, one of the world’s leading steel manufacturers, has partnered with Indonesia’s state-owned PT Krakatau Steel since 2010 to form PT Krakatau POSCO. This joint venture operates a large integrated steel plant in Cilegon, Banten, capable of producing 3 million metric tons of crude steel annually. PT Krakatau POSCO is now tasked with rolling out the seismic-grade steel designed for maximum resilience in tremor-prone regions.
POSCO brings with it decades of metallurgical innovation, having previously developed ultra-high-tensile steel for bridges, ships, and high-rises in Japan and South Korea. PT Krakatau Steel contributes local manufacturing, distribution networks, and government liaison in Indonesia’s rapidly growing construction industry.
Technical Anatomy of Earthquake-Resistant Steel
The seismic-grade steel produced by Krakatau POSCO is categorized under high-ductility, low-yield strength steel, which allows buildings to absorb and dissipate energy during seismic events. It has a tensile strength of over 600 MPa and yield strength in the range of 350–450 MPa. This balance provides structural flexibility while preventing catastrophic brittle failures.
According to POSCO engineers, the steel undergoes thermomechanical controlled processing, enhancing grain refinement and toughness. The alloy composition includes precise amounts of carbon, manganese, niobium, and vanadium to optimize strength-to-weight ratio and maintain weldability, a critical factor in earthquake-proof construction.
“Ductility and energy absorption are paramount,” said Kang Ji-hoon, POSCO’s Vice President of R&D. “We’ve engineered this alloy to deform in a controlled manner, allowing it to retain integrity during seismic waves that reach surface velocities of over 3 km/s.”
Scientific Validation & Performance Testing
The steel was subjected to rigorous lab tests and simulated earthquake conditions at the University of Indonesia. Prof. Bambang Suhendro, a senior expert in structural engineering, led the evaluation. “We tested cyclic loading to mimic ground shaking and found that this steel performed with over 35% elongation before failure,” he said. “That level of ductility is ideal for structures such as hospitals, skyscrapers, and bridges in earthquake-prone areas.”
The product meets both ASTM A913 and JIS G3136 standards, ensuring its compatibility with global seismic design codes. PT Krakatau POSCO also partnered with seismic monitoring institutions to model real-time quake scenarios on test structures using their steel.
Growing Demand Across ASEAN & Strategic Rollout
Indonesia’s National Development Planning Agency (BAPPENAS) has prioritized earthquake-resistant housing and commercial development in Sumatra, Java, and Sulawesi. The Indonesian Ministry of Public Works is reportedly in talks with PT Krakatau POSCO to include the steel in its national infrastructure blueprint through 2030.
Neighbouring countries like the Philippines and Vietnam are also exploring bulk imports, especially for coastal and urban projects. POSCO is leveraging its global network to supply this product to other seismic hotspots such as Turkey, Chile, and even California in the U.S.
To support regional demand, PT Krakatau POSCO plans to increase production to 800,000 metric tons annually within three years and install a second blast furnace.
Economic Impact & POSCO’s Global Positioning
PT Krakatau POSCO is now the third-largest profit earner within the POSCO Group, after POSCO and POSCO International. With this new product, POSCO aims to capture a niche segment of seismic-resilient materials in Asia, which industry analysts estimate could grow to $5 billion by 2030.
The joint venture is also seen as a cornerstone of South Korea’s soft infrastructure diplomacy, providing cutting-edge materials while helping developing economies meet UN Sustainable Development Goals, particularly in resilient urbanization.
Beyond profits, this initiative aligns with POSCO’s ESG strategy, as seismic-resistant structures reduce long-term emissions by avoiding reconstruction after disasters. The use of recyclable alloy compositions further improves its environmental score.
Future Vision & Innovation Pipeline
POSCO R&D is now working on a new steel composite with embedded smart sensors to monitor real-time stress levels during earthquakes. These “smart steels” will eventually alert city authorities to damage thresholds even before visual cracks appear.
PT Krakatau POSCO also plans to set up a Seismic Design Institute in Java to assist engineers and architects in using the steel optimally. Workshops, BIM modeling software, and certification courses will be launched by early 2026.
“This isn’t just a new product, it’s a tectonic shift in how we build safe cities,” said Kim Min-soo, POSCO’s Director of Global Operations.
Key Takeaways:
• POSCO & PT Krakatau Steel are mass-producing seismic-grade steel in Indonesia.
• Steel features high ductility, 600 MPa tensile strength & TMCP processing.
• Over 500 earthquakes ≥4.0 magnitude have hit Indonesia in 2025.
• The alloy meets ASTM A913 & JIS G3136 global seismic codes.
• PT Krakatau POSCO plans 800,000 metric tons output with future expansion.
• Smart sensor-embedded steel & Seismic Design Institute planned by 2026.
