Petrokimia starts NPK production in October

Petrokimia starts NPK production in October

SURABAYA (JP): State-owned PT Petrokimia Gresik will begin
production of a compound fertilizer in October this year, with an
annual production level of about 300,000 tons, the company's
president said here on Tuesday.

Rauf Purnama said the new fertilizer, known as NPK, would be
produced in cooperation with PT Perkebunan Nusantara II, III, IV
and V.

"The construction of the NPK fertilizer plant is 90 percent
completed," he said following a meeting with East Java Governor
Imam Utomo.

He said the construction of the fertilizer plant would cost
the company and its partners about US$26 million.

The plant, besides supplying the needs of the four state
plantation companies, will also produce fertilizer to be sold to
farmers to boost their rice production, he said.

In a pilot project carried out in the village of Bintoyo,
Ngawi regency, East Java, the use of the compound fertilizer was
proven to increase rice production from 6.3 tons per hectare to
9.3 tons per hectare.

He acknowledged the compound fertilizer, which contains
phosphate, nitrogen and potassium, would be a little bit more
expensive than conventional fertilizers.

"Farmers need to spend Rp 200,000 for the fertilizer for one
hectare of land. But it (the fertilizer) gives an added value of
between Rp 1.6 million to Rp 2.4 million from the increased rice
production per hectare, with the assumption that price of dried
unhusked rice is Rp 800 per kilogram," he said.

The use of fertilizer in Indonesia is low compared to in
Japan, Thailand, Malaysia and Taiwan.

"We hope that East Java will return to its glory as the
national rice bowl, with a total production of 34 million tons
per year," Rauf said, adding that orders for the new fertilizer
also have come from Bali, Central and West Java.

PT Petrokimia Gresik also plans to construct a second NPK
fertilizer plant with a capacity of 700,000 tons annually to meet
the expected demand, he said. "The second plant is scheduled to
be finished in 2003." (nur/sur)