New spinning mill built in C. Java

New spinning mill built in C. Java

JAKARTA (JP): PT Adikencana Mahkotabuana has started
constructing a Rp 30 billion (US$13.4 million) spinning mill in
Weru village, Central Java.

The company's president commissioner, Muhammad Lukminto, was
quoted by Antara as saying that the new mill will have a
production capacity of 3,000 bales of yarn a month and will
employ 1,000 workers.

The mill, he said, is scheduled to be completed in eight
months and will use spindles from China and the United States.

Lukminto said that the mill would face no problem in obtaining
cotton fiber for its raw material supply because, unlike the
domestic rayon fiber market, the cotton trade is free from
monopolistic practices.

Currently the rayon fiber market is dominated by PT Inti
Indorayon, PT Indo Barat and PT South Pacific. The oligopoly was
recently blamed for the sharp increase in the price of rayon
fiber which caused a number of textile industries to close down.

Lukminto pointed out that the high price of rayon fiber was
not caused by the shortage of the material but by the oligopoly.

Rayon fiber is currently priced at Rp 5,100 (US$2.3) per
kilogram.

Lukminto said that the Association of Textile Producers would
ask the government to remove tariffs on raw materials for
textiles. The government currently imposes import tariffs of
between 5 to 10 percent on polyester and rayon fiber. (pwn)