Why the Food Industry Needs to Switch to Paper Packaging
The Ministry of Industry is encouraging food and beverage industry players to increase the use of paper-based packaging as an alternative to plastic. Director General of Agro Industry at the Ministry of Industry, Putu Juli Ardika, stated that this step is effective in reducing dependence on plastic amid rising prices.
The increase in plastic prices is driven by disruptions in naphtha supplies from the Middle East due to the escalation of the Iran-Israel conflict, which impacts the global petrochemical industry. “We are promoting paper-based packaging because many food and beverage industries can still utilise this packaging,” Putu said during a media briefing at the Ministry of Industry office on Tuesday, 21 April 2026.
According to him, in terms of price, paper-based packaging is actually quite competitive. However, its development heavily depends on the readiness of the industrial ecosystem and investments in that sector. “This could become the game changer,” he said.
Putu explained that currently around 48 percent of food and beverage industry packaging is still plastic-based, while paper packaging usage has reached about 28 percent.
With that portion, he assesses that paper packaging is already widely used in Indonesia. In addition, this type of packaging is also considered to have good durability to maintain product quality. “Like for milk, juice, and many other products. It’s already competitive,” he said.
Previously, Putu said that plastic raw material stocks for the food and beverage industry are available for the next two months. This situation has made industry players start to worry about future plastic supplies.
Based on a meeting of the Ministry of Industry with plastic producers, Putu stated that plastic raw materials are now available again. Previously, he said, plastic pellet stocks had indeed been delayed, but now they are available again. “Now it’s available and there’s no worry. Well, the concern is that prices will rise.”
He stated that the most important thing now is to ensure supply availability. To suppress prices, he said there are several proposals from the Ministry of Industry to industry players.
One of them is the exemption of import duties on LPG for the plastic industry. “This is what the Minister proposed, how for the time being the import duties can be waived,” he said.
Geopolitical tensions disrupting energy supply chains have caused plastic prices to soar. Around 70 percent of global naphtha supplies come from the Middle East. Naphtha is a liquid processed from crude oil that serves as the main raw material in the petrochemical industry for producing plastic.
The rise in plastic resin prices exerts direct and significant pressure on business operational costs, particularly in sectors heavily reliant on packaging such as food and beverages, FMCG, pharmaceuticals, logistics, and retail.