Ministry of Industry States Energy Efficiency Will Not Disrupt Production But Issues This Warning
The Ministry of Industry (Kemenperin) is beginning to encourage industrial players to reduce energy consumption amid global supply chain pressures. This efficiency measure is deemed not to disrupt production targets, but on the other hand, it raises new challenges that need to be anticipated, particularly from logistics costs and raw material prices.
Spokesperson for the Ministry of Industry, Febri Hendri Antoni Arief, explained that the national industry is still able to maintain production activities despite disruptions in raw material supplies from the Middle East. This situation requires companies to be more prudent in managing available resources.
“Clearly, for upstream industries that rely on raw materials from the Middle East, there is indeed some delay. Up to now, the same industries are still producing using existing raw materials and will continue to produce,” he said, quoted on Wednesday (1/4/2026).
Amid these supply limitations, the market is responding with price adjustments for several derivative commodities. This phenomenon reflects cost pressures that are gradually being felt at the industrial level.
“Well, in the field, we see price increases in certain products. And we see that as the market’s effort to adjust prices for derivative products from raw materials originating from the Middle East,” he explained.
Petrochemical products such as olefins and plastics are cited as clear examples due to their widespread use in various sectors. From automotive to food and beverage industries, dependence on these materials makes price increase effects hard to avoid.
“If it’s petrochemical products, for example, olefins, plastics, yes, they are widely used by other industrial sub-sectors. For instance, the plastics industry in automotive, packaging in the beverage industry, food industry, or others, yes, they are used,” he said.
Nevertheless, the government assesses that the pressures occurring have not yet widely impacted the entire industrial sector. The effects are still concentrated on certain sub-sectors that heavily depend on imported raw materials.
“The impact of the energy logistics crisis in the Middle East on industry is still limited to certain industrial sub-sectors,” Febri stressed.
In this situation, energy efficiency becomes one of the main strategies promoted by the government. However, this step does not stand alone, as industrial players must also prepare to face potential increases in other costs.
“We urge the implementation of energy efficiency in the production process or in supporting industrial activities. Energy efficiency in the production process does not reduce the planned production targets,” he said.
On the other hand, the emerging challenges actually come from external factors such as logistics. Increases in shipping and distribution costs are deemed potentially to pressure the competitiveness of national industrial products, both for domestic and export markets.
“One thing that indeed needs to be monitored by industry going forward is the rise in logistics costs, both logistics costs for exports and the purchase of imported raw materials,” he added.
Furthermore, energy cost pressures are also said to be able to impact industrial performance indicators such as the Industrial Confidence Index (IKI) and the Purchasing Managers’ Index (PMI). Rising production costs risk holding back industrial expansion in the coming months.
“Whenever there is an increase in energy costs, it will pressure industrial performance, both the IKI value for subsequent months and the PMI value,” Febri revealed.