Business Owners Claim to Shoulder Part of the Burden - Not Arbitrarily Raising Plastic Prices

A surge in global raw material prices is directly affecting domestic plastic product prices. However, industry players face a dilemma as they cannot fully pass on the cost increases to consumers. This occurs amid production cost pressures from rising oil prices and supply disruptions.

The industry must balance maintaining profit margins with preserving market purchasing power. If prices are raised too high, demand could drop, impacting business sustainability.

Conversely, if not raised, companies must bear increasingly heavy cost burdens. Chairman of the Indonesian Olefin, Aromatic, and Plastic Industry Association (Inaplas) Suhat Miyarso explained that raw material price increases are significant and unavoidable.

“The price rise is almost linear with crude oil, around 80 to 120 per cent. This greatly affects production costs,” he stated during a discussion at the Industrial Journalists’ Forum (Forwin) in Jakarta on Tuesday (5/5/2026).

However, the industry’s ability to pass these costs to consumers is not straightforward. This is due to the public’s purchasing power not yet fully recovered.

Additionally, competition with cheaper imported products acts as a limiting factor.

“Cost pass-through cannot be complete. There is a limit to purchasing power, so we must bear some ourselves,” he said.

On the downstream side, the impact of price increases is felt across various sectors, including food packaging and household needs. Although supplies remain available, product prices have seen quite significant rises.

Suhat Miyarso noted that consumer-level price increases could reach quite high figures for some products.

“The problematic aspect is the price. Some have risen up to 100 per cent, like plastic bags. This is what the public complains about most,” he said.

Looking ahead, price stability will depend on improvements in global supply conditions and domestic policies.

“We hope the situation stabilises soon so prices can be more controlled and not continue to burden the public,” he concluded.