Layoff Threats Loom in Packaged Beverage Factories Due to Surging Plastic Prices

Jakarta, CNBC Indonesia - Packaged drinking water entrepreneurs are growing anxious about the rising prices of plastic raw materials, which could impact packaged drinking water (AMDK) products, whether in gallon packaging, plastic bottles, or plastic cups.

General Chairman of the Nusantara Packaged Drinking Water Association (Amdatara), Karyanto Wibowo, stated that the increase in plastic raw material prices has seriously affected the AMDK industry, as the majority of its packaging still uses plastic.

“The current rise in plastic raw material prices has a significant impact on the AMDK industry, because almost all AMDK packaging uses plastic, particularly polyethylene terephthalate (PET) resin for bottles, high-density polyethylene (HDPE) for gallons, and polypropylene (PP) for caps and labels,” Karyanto told CNBC Indonesia on Monday (13/4/2026).

He admitted that plastic material prices have risen by around 25% to 70%, with some even increasing by up to 100%, causing production costs to swell by up to 45%.

“The prices of PET resin and other supporting plastic materials have surged between 25% and 70%, even reaching 100% for some types of material since early April 2026. As a result, overall AMDK production costs have increased between 35% and 45%,” he continued.

Karyanto added that plastic is the highest production cost component after water itself.

“Plastic is the second largest production cost component after the water itself, so this increase can no longer be fully absorbed by producers,” he explained.

The impacts include price increases at the retail level, reduced production volumes, and threats of layoffs (PHK). Regarding product price increases, his side has not yet been able to detail them as they are still being calculated.

“The visible impacts include the start of sales price adjustments at the retail level, shortages of raw materials in some areas, declines in production volume, particularly for AMDK SMEs, and mass layoff threats looming over thousands of workers in this sector,” he said.

He also expressed concern about the current situation, where AMDK itself has become a basic necessity for society.

“We are very concerned because AMDK is one of society’s basic needs to obtain safe and hygienic drinking water,” he stated.