작성일자: 2014.4.4

작성자: 자카르타 무역관 Kim Eun Hee(ehkim@kotra.or.kr), Ruth Duhita(ruth@kotra.or.id)

 

 

1. Market Overview

 

□ Plastic Industry in Indonesia

 

 ○ Indonesia has a population of 240 million of which nearly 50% lives in urban areas. The vast population makes the food and beverage sector attractive to investors. As packaging is an integral part of the food as well as beverage industry, the demand for packaging is expected to grow in step with the growth in the food and beverage industry.

 

 ○ Plastic is used widely in Indonesia for food packaging. It is lightweight and its ability to be adapted for a wide range of decoration and design possibilities makes it the preferred choice for packaging, including for food.

 

 ○ Today the need for plastic commodities in Indonesia is very high. Almost the entire domestic industry requires plastic as a raw material. The food industry and FMCG(fast moving consumer goods) are the biggest users of plastic as a raw material which reached 60 %.

 

 ○ According to Suhat Miyarso, Vice Chairman of The Indonesian Olefin and Plastic Industry Association(Inaplas), the demand of raw materials for the plastics industry in Indonesia could reach 4.3 million tons per year. However until now, the production capacity in Indonesia is around 3.9 million tons per year that cannot be entirely absorbed in the country.

 

 ○ There are still a lot of plastic raw materials that needs to be imported about 1.5 to 2 million tons of the total requirements of 4.3 million tons. The demand is predicted will continuously increase year to year. According to Indonesian Statistics Agency(BPS), the importation of plastics and plastic goods for January to December 2013 rose 9.32% year-on-year to US$ 7.64 billion, as for imports in the same period in 2012 amounted to US$ 6.99 billion.

 

 ○ In downstream, the domestic production of plastic pellets depend on the trio of producers, namely PT Chandra Asri, PT Polytama Propindo, and Pertamina, but on their operational, they are also face difficulties in providing plastic raw materials such as naphtha and condensate. In this issue actually Indonesia has naphtha and condensate feedstock from natural resources, unfortunately the orientation of condensate and naphtha production is still likely to be exported. The impact is the demand of petrochemical industry raw material cannot be fulfilled, eventually leading the petrochemical industry feedstock of course still have to import, the amount of such imports on average per year to reach US$ 8 billion(Jaring News 11/4/14 ).

 

 ○ Indonesia produces the majority of the basic raw materials for plastic packaging like polyethylene, polypropylene, polypropylene copolymer, oriented polypropylene and PET(polyethylene terephthalate). Lamination grade LDPE is still imported. PT Chandra Asri, PT Polytama Propindo, and Pertamina are the key suppliers for these polymers in Indonesia.

 

Major Producer of Polymers in Indonesia

 

 ○ In the upstream Industry, the largest percentage of the plastic pellets enter the film making industry(production of plastic sheet) and plastic bottles Industry, about 60 %, in which two of the industry will lead to the flexible packaging industry(packaging).

 

 ○ In the packaging industry, there are several types of plastic also remains to be imported, such as Alu-Foil(film-metalizt) that are imported from China, namely Dong - Il, resin or plastic materials of Polyethylene Terephthalate(PET), and resin of Oriented Polypropylene(OPP). This is because of Indonesia has yet to produce all of it.

 

 ○ However Indonesia still can be proud in the sector of plastic sheets manufacturers(film making), as in some other products Indonesia has some class multinational companies such as PT Trias Sentosa Tbk, PT Panverta Cakrakencana(a subsidiary of Gudang Garam Tbk.) and etc. that are able to pioneering plastic sheet production demands domestically and to export these commodities.

 

 ○ PT Trias Sentosa is based in Sidoarjo, East Java, producing plastic sheet type of PET, PET-Metalizt, OPP and CHS(a mixture of types of PE, PP, and HD), where PET and OPP are needed in the packaging industry as raw material for printing material(mold), whereas CHS and PET-Metalizt as laminating material feedstock(coating).

 

 ○ So the easy analogous of it is like this: to meet domestic needs, Indonesia is still have to import 40 % of the total amount of plastic packaging to meet the needs of the food industry and FMCG(fast moving consumer goods) amounted to 60 %, such as for example an packaging of Extra Joss, an supplement drink in powder form, and other packaging such as shampoo, food packaging, etc..

 

 ○ Extra Joss that is sold in the market around Rp 1,000 per sachet is actually has a packaging that its price is more expensive rather than the price of the powder of Extra Joss inside the packaging. It could be from the Rp 1,000, the price of its packaging can be Rp 700. In the packaging valued Rp 700, there are three layers are required, among other things:

  - PET as a material that is printed and Indonesia for its raw materials are still imported.

  - Alu-Foil(metalizt layer) as the first laminated layer which is its cost is the most expensive one, and Indonesia also still import from China for these materials.

  - CHS B/C 120 microns the outer laminated layer, Indonesia’s domestic production.

 

 ○ The conclusion is can be said with the simple sum that Rp 500 of the price of Rp 700 is sourced from by import. So by the Rp 1,000 per sachet of Extra Joss, there are more than half of price of the goods are imported.

 

 ○ Meanwhile, if we want to observe furthermore, almost all of the goods we consume every day always use plastic packaging, with it can be said that the goods that we consume every day is the majority of imported materials.

 

 ○ Indonesia is still has a good potential in the plastic industry sector, where the demand continue to rise sharply in each year. This is due to the need of plastic Indonesia per capita is still low. According to the Secretary General of the Association of Olefin, Aromatic and Plastic Industries Indonesia(Inaplas), Dawn Budiyono, the imports of rise from year to year due to domestic plastic market potential is so great. Understandably, at this time, the plastic consumption in Indonesia is only 10 kg per capita per year, lower than the other ASEAN countries that more than 40 kg per capita per year such as Malaysia, Singapore, and Thailand. Now with difference of it, the potential for increasing plastic needs will be higher in the future.

 

 

2. Import Duty

 

 ○ The trade barrier to enter Indonesian market for plastic sheet or film that Korean companies have to aware is the import tariffs and taxes. According to the Ministry of Finance of Republic of Indonesia, the import tariffs and taxes of HS Code 3920 is as listed in the table below:

 

Import Tariffs and Taxes of HS Code 3920

      Source: Ministry of Finance

 

 

3. Import Trend

 

 ○ To get detail information about the import trend of PET Sheet, KOTRA Jakarta get sources from the Indonesian Statistic Agency(BPS). According to the BPS, the Indonesian Statistic Agency, the import value and volume of HS Code 3920 into Indonesia are as listed in the tables below:

 

The Import Value of HS Code 3920 into Indonesia

     Source: Indonesian Statistic(BPS)

 

 ○ The table above shows that the import of HS Code 3920 valued at US$ 440,484,448 that increased 7.6% compared to the previous year. The imports of PET Sheet(HS Code 3920.62) valued at US$ 62,359,244 that increased 15.5% compared to the previous year.

 

 ○ The total volume of the imports of HS Code 3920 is 189,785,363 in 2013 that has increased 6.5% compared to a year before. While the total import volume of PET Sheet(HS Code 3920.62) is 33,237,562 Kg, increased 17.6% compared to previous year.

 

The Import Volume of HS Code 3920 into Indonesia

     Source: Indonesian Statistic(BPS)

 

 ○ China is the most origin counties for the imports of PET Sheet entering Indonesian market. It dominated 48.5% of the total import. The total import value of it reached US$ 30,266,583 in 2013. It increased 41.2% compared to the previous year.

 

 ○ While South Korea is ranked in the fourth position with total import value at US$ 2,291,292 with share only 3.7% which far behind compared to China. The import has increased 14.9% compared to last year that reached US$ 1,994,723.

 

The Import Value of HS Code 3920.62(PET Sheet) based on Origin Countries into Indonesia

       Source: Indonesian Statistic(BPS)

 

The Import Volume of HS Code 3920.62(PET Sheet) based on Origin Countries into Indonesia

        Source: Indonesian Statistic(BPS)

 

 

4. Exhibition