Govt Prepares Strategy to Mitigate Surge in Plastic Prices

RRI.CO.ID, Jakarta - The Indonesian government is preparing a strategy to mitigate the surge in plastic prices, which has placed a heavy burden on micro, small, and medium enterprises (MSMEs) in the food and beverage sector.

MSMEs Minister Maman Abdurrahman said the main cause of the price increase is Indonesia’s reliance on imports, with around 55 percent of naphtha, the raw material for plastic, sourced from abroad. About 70 percent of this supply passes through the Strait of Hormuz.

“Naphtha, as the primary raw material for plastic, is supplied from the Middle East. Geopolitical tensions are driving significant price increases,” Minister Maman said in a written statement on Friday, April 10, 2026.

Data from the Indonesian Food and Beverage Producers Association shows that the scarcity of naphtha has constrained the national plastic industry's production capacity, forcing some production lines to halt operations.

MSMEs across the country are directly affected, with revenue declining by up to 50 percent. Dependence on plastic packaging remains particularly high in the food sector.

The domestic plastic packaging industry controls more than 67 percent of the market, with food production as the main driver of demand.

To address the crisis, the government, through the Ministry of Trade, is preparing strategic measures to secure alternative naphtha supplies from Africa, India, and the Americas. Administrative processes have been expedited to ensure smooth distribution, while long-term strategies are being developed to strengthen industrial resilience.

“This is not merely a solution to the supply crisis. It is an opportunity to build a green industry based on local potential,” Minister Maman said.

The government is also encouraging the use of alternative materials such as bamboo, seaweed, and cassava. Policy support is expected to reduce production costs and expand market opportunities. (Gusti Panji/Lasti Martina)