Producers of synthetic fiber to raise prices

JAKARTA (JP): Local synthetic fiber producers plan to raise the price of their products by between 5 percent and 13 percent in order to meet rising costs from the planned increase in fuel prices next month.

Risa Bhinekawati, secretary-general of the Association of Indonesian Synthetic Fiber Producers (APSyFI) said the new price would take effect immediately after the new fuel price is implemented.

"In order to minimize the impact of the fuel price hike, the price of synthetic fiber products will be increased by between 5 percent and 13 percent, or US$0.03 to $0.05 per kilogram," Risa told Bisnis Indonesia.

Fuel expenditure in the synthetic fiber industry accounted for 70 percent of the total cost structure, she said.

The government decided in the middle of this month to increase fuel prices for industrial consumers by between 50 percent and 100 percent on April 1.

Responding to public pressure over an increase in fuel costs, the government postponed planned price increases for kerosene, automotive diesel oil and gasoline sold at gas stations until Oct. 1 to prevent the already fragile social and political situations from worsening.

Yoichi Iida, marketing director for PT Teijin Indonesia Fiber Corp. Tbk., said that the price increase would be a major burden on the industry.

"We must also raise our prices if we don't want to lose," Iida said.

As most of the synthetic fiber companies use their own generators to power their plants, even a slight increase in the fuel price would immediately affect their operating costs, Iida added. (03)