Minister of Industry Strives for Diversification and Recycling to Safeguard Plastic Raw Materials
The industry is actively exploring naphtha supplies from countries outside the Middle East region to reduce regional dependency.
Jakarta (ANTARA) - Minister of Industry (Menperin) Agus Gumiwang Kartasasmita emphasised that the government is continuously striving for raw material diversification and promoting recycling utilisation to maintain national plastic availability amid global geopolitical pressures.
In response to the dynamics of plastic raw material prices and supplies, Agus, in a statement confirmed in Jakarta on Wednesday, explained that the escalation of conflict in the Middle East has affected the global petrochemical industry supply chain, particularly for naphtha commodities, which is the main raw material for plastic.
“The escalation of conflict in the Middle East has triggered a supply correction in industrial sectors dependent on naphtha as the main raw material. Considering that plastic is a derivative product from the petrochemical process based on petroleum, disruptions in global distribution and production routes indeed exert pressure on upstream cost structures,” he said.
As a response, the Ministry of Industry (Kemenperin), together with upstream petrochemical industry players, is taking several strategic steps to maintain domestic production continuity. One of them is by expanding raw material supply sources.
“The industry is actively exploring naphtha supplies from countries outside the Middle East region to reduce regional dependency,” Agus stated.
In addition, the optimisation of LPG usage is also being carried out as a buffer raw material in the production process.
“LPG usage is optimised as a buffer raw material or buffer in the production process to cover gaps in naphtha supply shortages,” he added.
On the other hand, his side is also encouraging the increased use of high-quality recycled plastic as a raw material substitute.
“The government is encouraging the increased use of recycled plastic or high-quality recycled plastic as a supply substitute to maintain stock stability in the market,” he clarified.
Regarding the issue of limited stock said to only suffice until May, Agus assured that the industry condition is still in the expansion phase.
Based on data from the Industrial Confidence Index (IKI), the packaging industry subsector in March 2026 showed very high performance, so plastic product stocks are deemed sufficient.
“Supply security efforts continue to run in parallel,” he stressed.
Nevertheless, he acknowledged a price correction at the production level in line with the rise in global raw material costs. However, the government ensures product availability remains maintained.
“Indeed, there is a price correction at the production level due to the rise in global raw material costs,” said the Minister of Industry.
“Society and downstream industries do not need to panic, because plastic products are assured to still be available in the market. The government is committed to ensuring no stock shortages by optimising various alternative supply channels,” Agus further revealed.
Furthermore, his side is also strengthening synergy with manufacturing industry players to anticipate the impact of global supply chain disruptions.
This step is taken to maintain the resilience of the national industry while ensuring the fulfilment of domestic needs and exports remains optimal.