DistantNews
🇮🇩 Indonesia /Economy & Trade

Plastic Price Surge Drives Up Costs for Indonesian Food and Beverage Products

From Tempo · (3d ago) Indonesian Critical tone

Translated from Indonesian, summarized and contextualized by DistantNews.

TLDR

  • Indonesian food and beverage industry leaders report that rising plastic prices are directly increasing the cost of their products.
  • The scarcity of plastic raw materials, with some suppliers warning of stock depletion by May or June, is causing significant price hikes ranging from 30% to 100%.
  • This cost pressure is forcing some businesses to adjust prices for basic goods like rice and cooking oil, impacting both industry margins and consumer affordability.

The Indonesian food and beverage sector is grappling with a significant challenge as the price of plastic packaging skyrockets, directly impacting the cost of essential goods. Adhi S. Lukman, Chairman of the Indonesian Food and Beverage Producers Association (GAPMMI), highlighted that nearly all food and drink products rely on plastic packaging, and the current supply chain disruptions have made obtaining these materials exceedingly difficult.

Ini memang situasi yang cukup rumit di industri, khususnya makanan dan minuman. Hampir semua pakai plastik, dan kita juga kesulitan mendapat (bahan baku) dari pemasok

— Adhi S. LukmanChairman of GAPMMI, describing the complex situation faced by the food and beverage industry due to plastic scarcity and rising prices.

This situation is not just about increased costs; it's also about availability. Suppliers are issuing stark warnings, with some indicating that their raw material stocks could be depleted as early as May or June. This looming shortage exacerbates the problem, creating uncertainty for manufacturers who depend on a steady supply of packaging materials to maintain production.

Beberapa sudah menyatakan kehabisan bahan baku untuk kemasan. Dari pemasok ada yang bilang terakhir Mei atau Juni sudah habis. Ini yang harus dicarikan solusinya

— Adhi S. LukmanHighlighting the critical supply issue, with suppliers potentially running out of raw materials for packaging in the coming months.

The price surge is substantial, with plastic costs reportedly jumping between 30% and 100%. For products where packaging constitutes a significant portion of the cost, such as basic items like meatballs or frozen meats, this increase is particularly burdensome. Lukman explained that even a 25% contribution of packaging to the cost of goods can lead to a substantial price hike if packaging costs double, making it difficult for industries to sell their products at competitive prices, especially when consumer purchasing power is already limited.

Misalnya kontribusi kemasan terhadap harga pokok itu sekitar 25 persen saja, kalau itu naik 100 persen kan berarti ke harga pokok tinggi sekali pengaruhnya sekitar 25 persen dan ini akan menyebabkan industri mengalami kesulitan untuk menjual, karena produknya pasti harganya mahal, sementara dari masyarakat terbatas

— Adhi S. LukmanExplaining the significant impact of packaging cost increases on the final price of food and beverage products and the resulting difficulty for industries.

Consequently, businesses are being forced to pass these increased costs onto consumers. This is evident in the rising prices of basic commodities like rice and cooking oil, where the price increase is attributed not to the products themselves, but to their plastic packaging. This inflationary pressure not only squeezes profit margins for businesses but also affects the affordability of daily necessities for the Indonesian public, creating a complex economic dilemma.

Beberapa sudah naik harga. Di pasar, yang basic seperti beras, minyak goreng. Itu bukan barangnya yang naik, tapi kemasannya yang naik, sehingga terjadi kenaikan harga

— Adhi S. LukmanPointing out that the price increases for basic goods like rice and cooking oil are driven by the cost of their plastic packaging.
DistantNews Editorial

Originally published by Tempo in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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