Rupiah Weakens and Gas Prices Soar: Ceramic Industry Feels Like It's Been Hit by a Ladder After Falling...

Indonesia’s national ceramic industry is facing heavy pressure during the first four months of 2026. The Indonesian Diverse Ceramic Industry Association (ASAKI) has revealed that gas supply disruptions, along with the weakening of the rupiah against the US dollar, represent a double blow that undermines the competitiveness of the national ceramic industry. The rupiah weakened again at the close of trading on Tuesday (5/5/2026). The Garuda currency fell 30 points or 0.17 percent to the level of Rp17,424 per US dollar. The pressure stems from the escalation of conflict in the Middle East. Tensions between the United States and Iran have intensified again since the beginning of the week. In the West Java region, for example, the realisation of AGIT in April 2026 only reached 37.5 percent, the lowest figure since the Specific Natural Gas Price (HGBT) policy was implemented in 2021. This situation directly impacts the surge in energy costs. Currently, the gas price borne by the ceramic industry reaches the range of $11.5-12 per MMBTU, or an increase of more than 60 percent compared to the HGBT price set at $7 per MMBTU. In fact, the gas energy component contributes the largest portion to the production cost structure of the ceramic industry, namely around 35 to 38 percent. This condition further burdens industry players because gas payment transactions are still in US dollars, so the weakening rupiah also amplifies the cost burden. “It’s like falling and then being hit by a ladder; the industry faces rising production costs as well as losses due to the exchange rate,” said Edy in a press statement received by Kompas.com on Tuesday night. Compared to neighbouring countries, Indonesia’s position is even more pressured. Industrial gas prices in Malaysia and Thailand are known to be in the range of $9.5 to $9.9 per MMBTU, lower than what domestic industries currently pay. ASAKI is urging the government, particularly the Ministry of Energy and Mineral Resources, SKK Migas, and PT PGN, to take concrete steps immediately. One of the hoped-for solutions is a quick fix to ensure gas supplies so that the industry does not collapse and avoids the potential for layoffs (PHK).