1Berita News – Product fertilizers downstreaming is a crucial step in enhancing the value-added and competitiveness of the national petrochemical industry. Therefore, the integration of fertilizer companies must be carried out to produce petrochemical products with high market value that can meet domestic and international market demands.
According to the Minister of State-Owned Enterprises, Erick Thohir, fertilizer companies, especially those owned by state-owned enterprises, must be integrated in the future and will be synergized together in line with Pertamina.
“If we look from the upstream itself, in the future these fertilizer companies must become an integrated petrochemical company. Because it will eventually come to a point where downstream petrochemicals can be felt comprehensively for the nation,” said Erick during the inauguration of the ammonium nitrate factory owned by PT Kaltim Amonium Nitrat (KAN) in Bontang, East Kalimantan, on Thursday (29/2).
Regarding the ammonium nitrate factory, Erick stated that this will help reduce the amount of fertilizer imports in Indonesia. He mentioned that through this factory, PT KAN will be able to increase domestic fertilizer production, where currently 21 percent is imported and 79 percent is domestically produced.
“Out of the total of 560 thousand tons, currently almost 300 thousand tons are produced domestically, and the rest is still imported,” explained Erick.
The ammonium nitrate factory is a joint project between the subsidiary of PT Dahana, PT Dahana Investama Corp (PT DIC) with the subsidiary of PT Pupuk Indonesia, PT Pupuk Kaltim. The construction of the factory, which has been carried out by PT KAN since 2020, is also supported by the collaboration of Wika-Sedin.
For information, the ammonium nitrate produced by KAN is the main raw material for explosive production. Therefore, adequate supply assurance is needed to maintain the company’s operational sustainability.
Moreover, ammonium nitrate can also be used as a raw material for NPK (Nitrogen Phosphorus Potassium) fertilizers based on nitrate and nitric acid, as well as its derivatives, which also play an important role in purifying metal minerals in smelters.
The construction of this factory is also in response to the increasing demand for ammonium nitrate commodities every year. For example, in 2024, state-owned enterprises project the demand for ammonium nitrate to reach 580,000 tons.
Therefore, the presence of the 75,000 MTPY capacity factory owned by PT KAN is expected to meet approximately 12 percent of the domestic demand for ammonium nitrate.
