ID/Damiana N. Simanjuntak
Sinar Mas Group and Tanjung Enim Lestari — two Indonesian pulp and paper producers — plan to build plants in the southern part of Sumatra island.
Aryan Wanrgadalam, a director of forestry and agricultural affairs at the Industry Ministry said that several Indonesian companies have proposed the plans to the ministry.
He said Sinar Mas has plans to build a pulp and paper plant that will produce 2 million tons a year. The investment for that project will be about $3 billion.
Sinar Mas, controlled by the Eka Tjipta Widjaja family, is one of Indonesia’s largest conglomerates.
Dhonny Rahajoe, a director of corporate communications at the group, however, said he wasn’t aware of the plan.
Asia Pulp & Paper, the biggest unit of Sinar Mas, expects its pulp and paper production to reach 2.6 million tons this year. The production will come from its six units, including Pabrik Kertas Tjiwi Kimia, Indah Kiat Pulp & Paper, Pindo Deli Pulp & Paper Industry, the Univenus and Ekamas Fortuna.
Aryan also said that Indonesian company Tanjung Lestari Enim plans to expand its pulp and paper plant in Tanjung Enim in South Sumatra to produce 500,000 tons per year.
Arya, said that assuming the company needs $1,500 to produce one ton of pulp, Tanjung Enim would need an investment of around $750 million.
Pulp production in Indonesia is forecast to reach 8 million tons this year, higher than the 7.6 million tons produced last year.
Paper production is forecast to increase 8.3 percent to 13 million tons this year from last year’s 12.4 million tons, Aryan said.
Aryan said Indonesia’s export of pulp hit 2 million tons per year and put paper exports at 4 million tons. He said with 4 million tons of paper, the country can expect to make around $4 billion.
“That’s for the paper alone,” Aryan said.
Misbahul Huda, chairman of the country’s paper production, said that pulp and paper production in Indonesia are expected to grow in the coming years. There are currently 79 paper plants in Indonesia and 14 pulp plants.