National Fertilizer Industry Levels Up, Indonesia Ready to Dominate Global Market

Jakarta - Indonesia has marked a new milestone in the transformation of its national fertilizer industry through the export of urea fertilizer to Australia, valued at approximately Rp7 trillion. This achievement symbolizes the strengthening of Indonesia’s position in the global fertilizer supply chain and marks its shift from a country previously facing supply problems to one with a national fertilizer production surplus.

The statement was made by Minister of Agriculture, Andi Amran Sulaiman while attending and directly inspecting the first export shipment of urea products from PT Pupuk Indonesia (Persero) through PT Pupuk Kalimantan Timur to Australia at Bontang Port, East Kalimantan, on Thursday (14/5/2026).

The shipment represents a new milestone in strengthening fertilizer sector cooperation through a government-to-government (G2G) scheme between Indonesia and Australia.

Minister Amran explained that today’s inaugural export consists of 47,250 tons of urea fertilizer valued at approximately Rp600 billion. This export is the initial stage of a cooperation commitment totaling 250,000 tons, which will be gradually increased to 500,000 tons with a total value of around Rp7 trillion.  

“We plan to export 250,000 tons to Australia and then increase it to 500,000 tons,” he said.

Minister Amran stated that this success demonstrates the growing competitiveness of the national fertilizer industry and opens up opportunities in new markets across various countries.

“Once again, on behalf of the government, I would like to thank Pupuk Indonesia for its hard work and achievements,” said Minister Amran.

According to Minister Amran, after Australia, the government is now directing efforts to strengthen national fertilizer exports to other strategic countries such as India, the Philippines, Brazil, and Bangladesh.  

“In addition, the Indian ambassador has contacted me directly to request 500,000 tons, and several other countries have also expressed interest, namely the Philippines, Brazil, and Bangladesh. We have also received reports of other countries interested in Indonesian urea fertilizer. This is something we are grateful for and proud of,” he revealed.

This success, Minister Amran continued, cannot be separated from the various strategic policies of President Prabowo Subianto in reforming the governance of the national fertilizer sector from upstream to downstream.

At the beginning of his administration, President Prabowo took a major step by increasing the allocation of subsidized fertilizer from around 4.55 million tons to 9.55 million tons to support the acceleration of national food self-sufficiency. The policy expanded the reach of beneficiaries to approximately 160 million people directly involved in the agricultural sector.

President Prabowo then implemented another strategic policy by reducing the price of subsidized fertilizer by 20 percent without adding any burden to the State Budget (APBN). This policy was accompanied by an additional 700,000 tons of subsidized fertilizer volume to broaden farmers’ access.

“At a time when global geopolitics is heating up, Alhamdulillah, Indonesia’s fertilizer prices have decreased by 20 percent. This is subsidized fertilizer for Indonesian farmers. Then the volume of fertilizer has also increased. This is the happiness of 160 million Indonesian farmers and 115 million rice farmers,” said Minister Amran.

The government has also carried out a total deregulation of 145 regulations across ministries and institutions to accelerate fertilizer distribution. The distribution system has been simplified into a direct pattern: Ministry of Agriculture – PIHC – Farmers’ Groups/Cooperatives – Farmers, so that fertilizer reaches farmers more quickly.

In addition, the government has reformed the national fertilizer subsidy mechanism by eliminating various inefficient components such as raw material profits, bank interest burdens, and double VAT. This reform is projected to save up to Rp14 trillion while reducing national fertilizer production costs.

Seven Strategic Fertilizer Projects

In addition to improving governance, the government is pushing for large-scale revitalization of the national fertilizer industry through seven strategic projects with a total investment of Rp72.84 trillion, involving PT Pupuk Indonesia (Persero), PT Pupuk Sriwidjaja Palembang, PT Pupuk Kalimantan Timur, PT Petrokimia Gresik, and PT Pupuk Kujang.

Modernization is being carried out by replacing old, energy-inefficient plants with new, more efficient facilities. The new fertilizer production cost efficiency is recorded at 26 percent lower than the old plants.

Through subsidy scheme reforms and industrial revitalization, the government projects savings on fertilizer subsidies of up to Rp112 trillion by 2035, while also reducing potential waste of Rp14.4 trillion per year.

The Prabowo presidency is also marked by the launch of new strategic projects, including the groundbreaking of the NPK Nitrate Plant in Cikampek on 23 December 2025 and the revamping of the PKT-2 Ammonia Plant in Bontang on 29 January 2026.

The government has also begun developing national methanol projects in Aceh and Bontang with a capacity of 2.5 million tons and an investment of approximately USD1.8 billion to support biodiesel needs and reduce dependence on imported industrial raw materials.

Minister Amran emphasized that all these improvements in the fertilizer sector are aimed not only at strengthening the national industry but also at supporting food self-sufficiency, improving farmers’ welfare, reducing imports, and building the independence of the national fertilizer industry amid global food crisis and geopolitical challenges.

“Fertilizer is not just about production and distribution. Fertilizer is a strategic instrument toward national food sovereignty,” Minister Amran asserted.