JAKARTA: As global energy prices rise, driven by geopolitical tensions in the Middle East, pressure is also increasing on the domestic bottled water industry, the Nusantara Bottled Water Companies Association (Amdatara) warns.
“We express serious concern over the increasing pressure on the (bottled water) industry due to the price surge in raw materials for packaging, particularly petroleum-based plastics,” Amdatara chairman Karyanto Wibowo said in a statement on Monday, as quoted by Kompas.com.
Karyanto noted that the industry is facing a structural shock, rather than ordinary market fluctuations.
Industry players said the surge in prices for petroleum-based plastics threatens to ripple through production chains and ultimately hit consumers’ wallets.
“Because more than 99% of global plastic is produced from fossil fuels, the surge in prices directly impacts production costs,” Karyanto said.
Amdatara estimates that raw material prices could increase up to 100% and lead to a 25% to 50% rise in finished packaging costs, depending on material type, production volume and business scale.
Small and medium-sized producers with limited liquidity are particularly vulnerable, while higher production costs could force producers to hike prices for bottled water, potentially disrupting public access to safe drinking water.
“This threatens not only thousands of businesses and tens of thousands of jobs, but also a vital contributor to public health,” Karyanto said.
The bottled water industry operates 707 factories nationwide with an installed capacity of 47 billion litres per year, making it a key pillar of the manufacturing sector. — The Jakarta Post/ANN
