Pupuk Indonesia CEO Assures Subsidised Fertiliser Prices Will Not Rise, Raw Material Supplies Secure
JAKARTA – The President Director of PT Pupuk Indonesia (Persero), Rahmad Pribadi, has assured that the highest retail price (HET) for subsidised fertiliser will not increase despite turbulence in the Strait of Hormuz. Thus, supply and stability can be maintained domestically.
“The HET for subsidised fertiliser was previously reduced by 20 per cent, and there are no plans to raise it again. This means the HET will remain the same,” Rahmad said during a working meeting with Commission XI of the House of Representatives in Jakarta on Thursday (2/4/2026).
According to him, although the Strait of Hormuz is a strategic route through which around 30 per cent of global fertiliser trade passes, the unrest in the region does not affect domestic fertiliser supply. Rahmad assured that Indonesia is not significantly impacted due to its large domestic urea production capacity, sufficient to meet national needs.
Pupuk Indonesia’s operational urea production capacity stands at 8.8 million tonnes, although installed capacity reaches 9.4 million tonnes with some facilities being old. With this capacity, domestic needs for urea fertiliser, both subsidised and non-subsidised, are believed to be met without dependence on foreign supplies.
Rahmad even stated that Indonesia has the potential to become a stabiliser in the global food ecosystem, particularly in ensuring fertiliser availability amid international market uncertainties.
Moreover, global urea prices had surged from around US$400 per tonne to US$800 per tonne due to the closure of the Strait of Hormuz, but this condition does not directly impact domestic supply.
In addition to urea, supplies of other raw materials such as phosphate and potash are also assured to be secure, as there are no production disruptions from major supplying countries.
Any potential impact would more likely affect shipping costs (freight), but this is deemed not to disrupt overall fertiliser availability domestically.
With these various factors, Pupuk Indonesia assures that national fertiliser availability remains safe and stable, while keeping prices controlled to support agricultural sector productivity.
The government previously reduced subsidised fertiliser prices by 20 per cent, effective since October 2025. This policy is part of a major breakthrough by the administration of President Prabowo Subianto.
For decades, fertiliser prices tended to rise every year or two. However, fertiliser prices have successfully been lowered thanks to budget efficiencies arising from government policies.
The reduction in subsidised fertiliser prices applies to two main types, namely urea and NPK. For urea fertiliser, the previous price of Rp 2,250 per kilogram has now dropped to Rp 1,800 per kilogram. Thus, the price per 50-kilogramme sack, previously Rp 112,500, is now Rp 90,000.
Meanwhile, NPK fertiliser, previously sold at Rp 2,300 per kilogram, is now set at Rp 1,840 per kilogram. The price per 50-kilogramme sack has also dropped from Rp 115,000 to Rp 92,000. The reduction applies nationwide.
This reduction is believed to directly impact the increase in Farmers’ Exchange Rate (NTP), lower production costs, and improved farmer welfare. The government is optimistic that national agricultural production will increase significantly in the coming years.
“Due to the impact of this 20 per cent HET reduction, there has been a significant increase in fertiliser redemption in 2025 and 2026. In 2026, it increased by 31 per cent,” Rahmad stated.
However, he did not provide detailed figures on the quantity of subsidised fertiliser distributed to farmers in the January-March 2026 period.