Tight Naphtha Supply, Government Targets Africa to America for Plastic Raw Materials

Trade Minister Budi Santoso stated that the government is seeking various alternative countries as suppliers of plastic raw materials to maintain supply stability and domestic prices amid global supply chain pressures. Budi explained that the main raw material for plastic pellets, naphtha, has traditionally been supplied from the Middle East region. However, global conditions have made shipping longer and competition between countries for obtaining the material increasingly tight. “So indeed, for plastic, the raw material for plastic pellets has so far come from naphtha from the Middle East. Now we have obtained alternatives from Africa, India, and America,” Budi told Antara at the Antara Heritage Center, Jakarta, on Thursday (16/4/2026). According to him, global logistics disruptions have caused the distribution of raw materials to become slower. At the same time, many countries are also competing for naphtha supplies, affecting the availability of plastic raw materials worldwide. In addition, he mentioned that several plastic-producing countries are now prioritising domestic needs. Many large companies in Taiwan, Thailand, to South Korea are prioritising the domestic market, so global export supplies are also decreasing. The government is currently prioritising the stabilisation of plastic prices through strengthening supply. The Ministry of Trade continues to coordinate with industry players and Indonesian trade representatives abroad to open access to new plastic raw material suppliers. Budi also stated that the increase in plastic prices has not yet significantly affected commodity prices in the market. “We are focusing on how to make plastic cheap. The key is, if plastic is cheap, the others will also be cheap. However, in general, there has not been a significant increase,” he explained. Budi added that the government is opening communications with all countries that have the potential to supply plastic raw materials so that national industry players have more import source options and do not depend on a particular region.