Downstream plastic production this year is projected to grow above 5 percent, assuming there is no further wave of the Covid-19 pandemic. The Indonesian Olefin, Aromatic, and Plastic Association (Inaplas) noted that downstream plastic production last year was stagnant at 7.2 million tons. Inaplas Secretary-General Fajar Budiyono hopes that the production volume can grow from 7.6 million tons to 7.8 million tons in 2022. One of the driving factors is the performance of the party sub-sector, as well as food and beverages in the tourism line, which has reached 75 percent by the end of last year. "The projection [of downstream plastic production] is pretty good because parties and tourism have started to loosen up a lot," Fajar said when contacted by Bisnis, Monday (17/1/2022).
The recovery of the tourism sector, continued Fajar, has helped increase the consumption of rigid plastic and flexible packaging. He hopes that the utility of downstream industrial production can reach above 80 percent this year. Fajar continued, last year's production volume was relatively stagnant because it was still in the recovery phase. However, the volume of imported plastic was observed to have decreased significantly, thereby increasing the utility in several types of products, such as export-oriented food packaging. In addition, plastic products related to pharmaceuticals and health have also experienced growth of more than 20 percent, although in volume they have not been able to increase the total industrial production. "Hand sanitizers, then masks, and pharmaceuticals grew by more than 20 percent, but that's in volume compared to other [products], which tend to be small because food and drinks are almost 35 percent," he explained.
Previously, Fajar said that investment in the downstream plastic industry was estimated to reach US$ 500 million, or around Rp. 71.17 trillion this year. The investment value will flow to the replacement of machines to adjust to fluctuations in commodity prices which also increase the price of raw materials. Machine regeneration is needed when industrialists use alternative raw materials that are more efficient. In addition, industry players in downstream plastics are also targeting new markets or breaking up existing ones. The shift in people's lifestyles and spending styles is suspected to be the driving force. Meanwhile, investment in the upstream plastic industry could reach US$ 300 billion by 2026.
