Deputy Industry Minister: CPO Can Become Alternative Plastic Raw Material
JAKARTA, KOMPAS.com - Deputy Minister of Industry (Wamenperin) Faisol Riza stated that crude palm oil (CPO) could serve as an alternative raw material for plastics.
Faisol explained that the domestic plastics industry needs to implement diversification of raw materials to replace naphtha, a petrochemical product derived from petroleum.
“Indeed, diversification is needed to replace naphtha, either from gas or from plant-based sources. Hopefully, this can become an opportunity for CPO, for example,” said Faisol when met at the Parliament Complex in Senayan, Jakarta, on Wednesday (8/4/2026).
According to Faisol, the country’s CPO stocks are plentiful and could substitute for naphtha, which has traditionally been supplied from Gulf countries in West Asia.
Nevertheless, the use of CPO as a plastic raw material is still under study.
“Hopefully, it can become the main substitute material,” Faisol remarked.
Currently, he said, there are companies that have already stocked up more on LPG for plastic raw materials.
However, the government has not yet decided to impose special tariffs on LPG imported from abroad for the plastics industry’s needs.
“We haven’t reached that point yet; certainly, prices abroad are already high, so the government is striving to ensure that downstream sectors are not affected,” Faisol stated.
He acknowledged that sourcing plastic raw materials is currently difficult. Industry players are no longer prioritising raw material prices as much, focusing instead on stock availability.
“This is about availability, not price. The industry is also calculating logistics costs and various other factors,” said Faisol.
It is known that plastics are expensive and scarce because 70 per cent of their raw material, naphtha shipped from Gulf countries, has been halted due to the war.
Naphtha is a processed product from fossil fuels.
General Secretary (Sekjen) of the Central Board of the Indonesian Market Traders Association (IKAPPI) Reynaldi Sarijowan stated that plastic prices have risen by up to 50 per cent from pre-war levels.
“Far before entering Ramadan, it was still 10,000. Then it gradually increased over a week, another week, another week—up by Rp 500, up by Rp 700, various increases—until today, the peak is projected at 50 per cent for us,” said Reynaldi when contacted by Kompas.com on Monday (6/4/2026).