Indonesian ceramic industry needs government backing amid high gas prices

Indonesia's domestic ceramic industry is calling for greater government support to ensure its competitiveness and prevent it from being overtaken by imported products. Saleh Husin, Deputy Chairman for Industry at the Indonesian Chamber of Commerce and Industry (Kadin), emphasized this need after attending a recent Indonesian ceramic exhibition.

Husin observed that the quality, standards, and designs of Indonesian ceramics are already on par with international offerings. However, a significant hurdle is the pricing of industrial gas. While the industry is eligible for a subsidized rate of $7 per MMBTU (known as HGBT), it currently only receives this rate for 40% of its allocation. The remaining 60% must be purchased at the market price of $21 per MMBTU, severely impacting production costs and competitiveness.

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I think this industry has developed quite well and creates jobs and provides good added value for our nation. We must not let this industry die and be eroded by imported products and excessively high energy prices.

"The industry has developed quite well and creates jobs and provides good added value for our nation. We must not let this industry die and be eroded by imported products and excessively high energy prices," Saleh stated. He highlighted that government initiatives like school construction and housing development could boost demand for local ceramics, but this potential is threatened by the gas price issue.

Kadin Indonesia is urging the government to provide the necessary "preferential treatment" to ensure the domestic ceramic industry can thrive. Without intervention, the high operational costs could force businesses to halt production, potentially turning Indonesia into a net importer of ceramics despite its abundant raw materials.

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For that reason, government support is greatly needed so that the domestic ceramic industry can become the host in its own country.