Acetic acid firm expands to meet domestic demand
Acetic acid firm expands to meet domestic demand
SURAKARTA, Central Java (JP): The country's first acetic acid manufacturer, PT Indo Acidatama Chemical Industry, has increased its production capacity by 50 percent to 33,000 tons per annum to help satisfy domestic demand.
Minister of Industry Tunky Ariwibowo inaugurated the company's expanded operation in a ceremony here yesterday.
Tunky said the new plant, which cost Indo Acidatama Rp 47 billion (US$21.36 million) to build, would help the country reduce its foreign exchange spending on imports by $32 million annually.
"With this expanded unit in operation, Indonesia needn't import acetic acid anymore for the production of purified terephthalic acid (PTA), a chemical substance used for polyester production," Tunky said at the ceremony, which was also attended by Director General of Chemical Industry Sujata and the company's chief commissioner, Sudwikatmono.
Minister Tunky called on private investors to follow the lead of Indo Acidatama in developing industries which took advantage of the country's strength in the availability of natural resources.
"There are still plenty of opportunities to build industrial plants which process the country's primary commodities such as natural rubber, crude palm oil and molasses," Tunky said.
He added that industrial plants processing agricultural commodities would face only light competition abroad when they exported their products, because not so many countries in the world had the same raw materials that Indonesia has.
Added value
He said that Indonesia's primary agricultural commodities had, to date, mostly been directly exported. "Why don't we increase their value before exporting them to generate higher revenues?"
Citing Indo Acidatama as an example, Tunky said the company bought molasses -- a raw material for acetic acid production -- from sugar factories in Central and East Java at $70 per ton and sold its ascetic acid for $700 per ton.
In addition to acetic acid, Indo Acidatama also produces ethanol and ethyl acetate. Ethanol is an important ingredient in beverages, cosmetics, cigarettes and some medicines, while ethyl acetate -- a combination of ethanol and acetic acid -- is for the production of plastics.
Sudwikatmono said the company was preparing to float 20 percent of its shares on the Jakarta Stock Exchange later this year. However, he refused to disclose how many shares would be offered to the public, saying only that the company expected to raise some Rp 50 billion from its public offering.
He said that he was planning to build a new plant in Tangerang, West Java, to process acetic acid from into PTA.
"Our textile companies are currently still importing a significant amount of PTA. So, as a businessman, why don't I take advantage of this good opportunity?," Sudwikatmono said. (rid)