Indonesia's state-owned fertilizer holding company (PIHC) is fully accelerating the domestic fertilizer industry upgrade, simultaneously advancing seven new and renovation factory projects across multiple locations to significantly boost overall production capacity, improve the subsidized fertilizer control system, and strengthen the national food production support foundation. PIHC's Operations Director announced the plan at the 2026 Indonesia Food Summit held in Jakarta. The total investment for the seven projects is as high as 77 trillion rupiah, with factories being completed and put into operation in phases. Most projects are expected to achieve commercial operations between 2027 and 2029, and all seven projects are scheduled for full completion and production by 2029. The seven projects span multiple provinces in Indonesia, covering key agricultural chemical categories such as urea, ammonia fertilizer, nitro compound fertilizer, and soda ash.
The PUSRI-3B ammonia and urea plant in Palembang, South Sumatra, will start production in Q1 2027, producing 445,500 tons of ammonia and 907,500 tons of urea annually; the nitro compound fertilizer plant in Cikampek, West Java, will start the second phase of production the same year, producing 100,000 tons of nitro compound fertilizer annually; the phosphate and potassium compound fertilizer plant No. 6 in Gresik, East Java, and the soda ash plant in Bontang, East Kalimantan, are scheduled for production in 2028, with annual capacities of 600,000 tons of compound fertilizer and 300,000 tons of soda ash plus 300,000 tons of ammonium chloride respectively; two large ammonia and urea plants in the Lhokseumawe fertilizer industrial park, Aceh, and Fakfak are scheduled for production in 2029 and 2030 respectively, becoming the core projects with the largest production capacity, each with an annual urea production exceeding one million tons. In addition, the ammonia equipment renovation project No. 2 in East Kalimantan will be completed in 2026, while producing 660,000 tons of ammonia annually, it will also comprehensively optimize production energy consumption and operational efficiency.
Alongside the new capacity expansion, PIHC is also optimizing the outdated capacity layout, announcing the closure of an old fertilizer plant in Palembang that has been in service for many years. Due to aging equipment and low production efficiency, the plant does not meet modern production planning. It will continue to operate in phases and will be gradually phased out based on dynamic adjustment plans, replacing old capacity with new capacity to improve overall industry efficiency. Overall, this round of large-scale investment and construction is not only a key measure to upgrade Indonesia's fertilizer self-sufficiency capability, but also ensures the stable supply of subsidized fertilizers for agriculture. By optimizing industrial structure, updating production equipment, and rationally deploying national production capacity, it will help increase agricultural output, strengthen Indonesia's food security resilience, and promote the sustainable development of the fertilizer industry towards large-scale, efficient, and modern operations.
Indonesia's state-owned fertilizer holding company (PIHC) is fully accelerating the domestic fertilizer industry upgrade, simultaneously advancing seven new and renovation factory projects across multiple locations to significantly boost overall production capacity, improve the subsidized fertilizer control system, and strengthen the national food production support foundation. PIHC's Operations Director announced the plan at the 2026 Indonesia Food Summit held in Jakarta. The total investment for the seven projects is as high as 77 trillion rupiah, with factories being completed and put into operation in phases. Most projects are expected to achieve commercial operations between 2027 and 2029, and all seven projects are scheduled for full completion and production by 2029. The seven projects span multiple provinces in Indonesia, covering key agricultural chemical categories such as urea, ammonia fertilizer, nitro compound fertilizer, and soda ash.
The PUSRI-3B ammonia and urea plant in Palembang, South Sumatra, will start production in Q1 2027, producing 445,500 tons of ammonia and 907,500 tons of urea annually; the nitro compound fertilizer plant in Cikampek, West Java, will start the second phase of production the same year, producing 100,000 tons of nitro compound fertilizer annually; the phosphate and potassium compound fertilizer plant No. 6 in Gresik, East Java, and the soda ash plant in Bontang, East Kalimantan, are scheduled for production in 2028, with annual capacities of 600,000 tons of compound fertilizer and 300,000 tons of soda ash plus 300,000 tons of ammonium chloride respectively; two large ammonia and urea plants in the Lhokseumawe fertilizer industrial park, Aceh, and Fakfak are scheduled for production in 2029 and 2030 respectively, becoming the core projects with the largest production capacity, each with an annual urea production exceeding one million tons. In addition, the ammonia equipment renovation project No. 2 in East Kalimantan will be completed in 2026, while producing 660,000 tons of ammonia annually, it will also comprehensively optimize production energy consumption and operational efficiency.
Alongside the new capacity expansion, PIHC is also optimizing the outdated capacity layout, announcing the closure of an old fertilizer plant in Palembang that has been in service for many years. Due to aging equipment and low production efficiency, the plant does not meet modern production planning. It will continue to operate in phases and will be gradually phased out based on dynamic adjustment plans, replacing old capacity with new capacity to improve overall industry efficiency. Overall, this round of large-scale investment and construction is not only a key measure to upgrade Indonesia's fertilizer self-sufficiency capability, but also ensures the stable supply of subsidized fertilizers for agriculture. By optimizing industrial structure, updating production equipment, and rationally deploying national production capacity, it will help increase agricultural output, strengthen Indonesia's food security resilience, and promote the sustainable development of the fertilizer industry towards large-scale, efficient, and modern operations.
