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The upstream and downstream textile and textile products (TPT) industries are currently sluggish. This is due to the impact of global oil prices which are still high and still above 200 US dollars per barrel. Secretary General of the Indonesian Filament Yarn and Fiber Producers Association (APSyFI), Redma Gita Wirawasta, revealed that the increase in crude oil prices caused an increase in the prices of the main raw materials for Polyester and Acetic Acid as Rayon's main auxiliary materials. "This is a challenge for us, because to maintain production output, we need additional working capital," he explained, Tuesday (4/19/2022).

However, up to now, the upstream textile industry has not reduced its production volume. Just so you know, the average utilization of polyester at 85% and rayon at 90% is still stable. As for the increase in the price of raw materials, Redma acknowledged, it was passed on to the selling price of the product.

Apart from being pressured by the increase in world crude oil prices, Redma said the upstream textile industry must also face other challenges, such as the plan to increase PLN's electricity tariffs as a result of rising coal prices. According to him, it is unfair if the domestic industry is charged with international prices for mining goods originating from Indonesia, especially according to him this policy only benefits a few groups. Furthermore, another challenge faced by the upstream textile industry is the increase in logistics costs which adds to the array of things that will drive inflation.

Secretary General of the Indonesian Textile Association (API), Rizal Tanzil Rakhman said some downstream textile raw materials are derivatives of petroleum, such as polyester.

According to Rizal's latest observations in the field, currently the polyester price has increased by 20%-30% from the normal price.

Of course, if the cost of polyester goes up, the price of yarn will also go up, automatically the prices of fabrics and clothes will also increase. In fact, the increase in crude oil prices has had a major impact on the local garment industry. Meanwhile, export-oriented garments already have contracts or orders from a long time ago.

"If the price of raw materials, in this case polyester, rises, of course it will affect the selling price of downstream textile products, so there must be a price adjustment," he explained when contacted separately.

The increase in clothing prices coincided with the momentum of Ramadan and Eid, where demand should be higher than normal days. However, Rizal fears that this price adjustment will hamper sales because the market cannot absorb the product. Therefore, business actors are still waiting and see to supply clothes in large quantities. Producers must carefully calculate their production volume to reduce dead stock in the field.

"Nowadays, the average utilization of garment factories is at the level of 70% -80%, whereas usually during the Eid momentum (before the pandemic) the utilization is at 100%," he said.