The Ministry of Agriculture plans to build seven fertilizer plants worth some Rp 50 trillion (US$3 billion) by 2029, five of which are expected to be completed within that year, said Minister of Agriculture Amran Sulaiman.

“Out of the seven fertilizer factories planned, five are targeted to be completed by 2029. The total budget is around Rp50 trillion,” Amran told a press conference in Jakarta on Wednesday, October 22, 2025.

Currently, Indonesia operates between 12 and 13 fertilizer plants nationwide. The new plants, he cited, are part of President Prabowo Subianto’s directive to revitalize the agricultural sector from upstream to downstream, strengthening national self-sufficiency in fertilizer production.

Amran said the construction of new factories will help cut production costs by more than a quarter and significantly reduce dependence on imported raw materials.

He noted that older fertilizer plants tend to generate higher profits due to outdated operational systems, which ultimately harm both farmers and the state.

“Older factories incur around 10 percent higher operating costs. This may seem profitable for the companies, but it’s actually inefficient for farmers and the country,” Amran said.

In terms of energy consumption, older plants use around 43 percent gas input, while newer facilities require only about half that amount, making the modernization program a key efficiency solution, he added.

Fertilizer prices

On the same occasion, Amran also revealed that the government has reduced the maximum retail price (HET) of subsidized fertilizers by 20 percent, effective immediately on Wednesday, October 22, 2025.

He emphasized that the price reduction was achieved without increasing state subsidies, thanks to industrial efficiency measures and improvements in national fertilizer distribution management.

“Under the directive of President Prabowo, fertilizer prices are reduced by 20 percent. Entering the second year of the Prabowo–Gibran administration, this is the first time in history such a reduction has occurred,” Amran said.

The new prices are stipulated in the Minister of Agriculture Decree No. 1117/Kpts./SR.310/M/10/2025, which amends the previous decree on fertilizer types, retail price ceilings, and allocation of subsidized fertilizers for the 2025 fiscal year.

The retail price reduction applies to all subsidized fertilizer types used by farmers, as follows:

● Urea: from Rp2,250/kg to Rp1,800/kg;

● NPK: from Rp2,300/kg to Rp1,840/kg;

● NPK for cocoa: from Rp3,300/kg to Rp2,640/kg;

● ZA (for sugarcane): from Rp1,700/kg to Rp1,360/kg;

● Organic fertilizer: from Rp800/kg to Rp640/kg.

Amran said the new policy will directly benefit more than 155 million people, including farmers and their families across Indonesia.

Sourcing from https://indonesiabusinesspost.com/