INDONESIA: Inaplast eyes rising plastics demand, prices in New Year

Indonesia's plastic manufacturers expect their combined turnover next year (2016) to reach Rp 130 trillion (USD 9.4 billion), up 17 % from an estimated Rp 111.6 trillion this year (2015) on the back of rising demand.

Budi Susanto Sadiman, deputy chairman of the Aromatic Olefin and Plastic Industry Association (Inaplast), said manufacturers eyed a 6 % increase in terms of volume, from 4.65 million tons this year (2015). Members also expect a 10 % increase in prices next year (2016) to account for rising costs, he said.

Economic growth is set to rebound to 5.3 % next year, from 4.8 % this year, on the back of the government's economic stimulus packages which are expected to boost investment and household spending, and in turn increase purchasing power.

"Demand will rise, because the industry is also experiencing an increase in sales of products, especially in the food and beverage sector, as well as agribusiness," Budi said in a recent interview. The plastics industry's turnover will also be driven by higher selling prices, as manufacturers anticipate higher prices of oil — the raw material for plastics. Producers currently sell plastic at an average of Rp 24,000 per kilogram. "Currently, world oil prices are at a very low level, so it will likely rise next year. It will affect the selling price of plastic, because the raw material accounts for up to 60 percent of the selling price," he said.

Source: Daily “The Jakarta Globe”, Jakarta; 10 Dec 2015
(Syed Rashid Ali, Karachi, Pakistan)