The textile industry recorded another contraction in the third quarter of 2021. According to the Central Statistics Agency (BPS), the textile and apparel industry fell by -3.34 percent year-on-year. However, the Indonesian Textile Association (API) remains optimistic that industrialists can turn things around at the end of the year, driven by high demand and the market continues to recover. "I remain optimistic that this improvement seems to be on the right track," said API General Chair Jemmy Kartiwa Sastraatmaja to Bisnis, Tuesday (9/10/2021).

Jemmy continued, if it cannot achieve positive growth this year, at least the textile industry can reduce the contraction rate compared to last year.
Previously, in Q1/2021 the textile and apparel industry contracted -13.28 percent yoy, followed by a decline of 4.54 percent in the second quarter, most recently -3.34 percent in the third quarter. As for last year, the textile industry also contracted 8.88 percent.

"I believe it should be possible, at least it should be able to grow a little, because the time is short, only the last quarter is left," Jemmy continued.

This optimism is driven by utilization, which began to improve in October 2021, which almost reached 80 percent. This improvement is also reflected in the achievement of Indonesia's manufacturing purchasing managers' index (PMI) in October 2021 which reached 57.2.

In addition, he continued, Indonesia will also benefit from efforts to diversify the supply chains of other countries that shift orders to Indonesia. Orders are also made in the long term, making it easier for business actors to design work plans.

Meanwhile, according to the records of the Ministry of Industry, the average utilization of the textile industry until September 2021 is at 72.31 percent. In contrast, the apparel industry is 84.83 percent, and the leather, leather goods and footwear industry has reached 80.18 percent.

"If we look at the utilization, between September to October, October is much better. From there, we can already measure that for sure if the utilization goes up, demand goes up, in line with the better PMI data," said Jemmy.