SCI Sees Opportunity to Strengthen National Supply Chains Amid Global Disruptions

JAKARTA, Jakartaweekly.com – Supply Chain Indonesia (SCI) views the current challenging global conditions, which have begun to affect the availability of industrial raw materials, as a potential momentum to strengthen national supply chain resilience and enhance industrial competitiveness.

SCI Founder and Chairman Setijadi stated that the organization has outlined five key recommendations for stakeholders to reinforce the national supply chain and, in turn, boost industrial competitiveness.

First, supply diversification must be carried out aggressively and in a measured manner to reduce dependence on one or two primary supplier countries.

“Diversification should be pursued by mapping alternative sources across regions such as South Asia, Africa, and Latin America, while also assessing geopolitical risks, supply stability, and logistics readiness to avoid creating new vulnerabilities in the supply chain,” he said in a statement received by Jakartaweekly.com on Friday, April 17, 2026.

Second, stakeholders need to strengthen inventory strategies through risk-based selective buffering. Companies should identify critical raw materials that are difficult to substitute and implement adaptive inventory policies.

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This approach is not merely about increasing stock levels, but about ensuring the availability of strategic materials to maintain production continuity without placing excessive pressure on inventory costs.

Third, companies must enhance end-to-end supply chain visibility and control. Amid heightened uncertainty, full transparency from upstream suppliers to downstream distribution is essential.

Setijadi emphasized that the adoption of technologies such as digital supply chains, tracking systems, and predictive analytics is key to detecting potential disruptions early and enabling faster, more accurate decision-making.

Fourth, companies need to develop material flexibility and product design adaptability. This includes assessing alternative raw materials to reduce reliance on specific inputs. Such efforts require close collaboration between procurement, R&D, and production functions to ensure that material substitution meets quality standards without compromising product performance.

Fifth, the development of upstream domestic industries must be accelerated. The government is urged to promote the growth of domestic raw material sectors, particularly petrochemicals, basic chemicals, and industrial materials.

In addition to reducing import dependency, this effort should be supported by stronger upstream-to-downstream integration to build a more resilient, efficient, and adaptive national supply chain.

Global Supply Chain Disruptions Begin to Take Toll

Meanwhile, Setijadi noted that global supply chain disruptions have started to directly impact the availability of non-energy industrial raw materials in Indonesia. The most visible indication is the surge in domestic plastic prices, which have risen by up to 100%, reflecting disruptions in imported raw material supplies that serve as key inputs for various manufacturing sectors.

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This situation goes beyond price increases, signaling the early stages of a raw material stock crisis. According to him, disruptions are not limited to plastics but also affect industrial chemicals such as sulfur and acids, metal materials such as aluminum, as well as critical materials like helium used in the electronics and high-tech industries.

“Many of these materials are difficult to substitute in the short term, directly affecting production processes,” he said.

He added that Indonesia’s vulnerability is exacerbated by its industrial structure, which remains heavily dependent on imports. More than 70% of the country’s industrial raw material needs are sourced from abroad, particularly in the chemical, petrochemical, and material-based manufacturing sectors.

As a result, domestic industries face risks of raw material delays, declining production capacity, and rising input costs when global supply disruptions occur.

SCI also observes that the current disruption reflects a multi-material shortage, where various types of raw materials are affected simultaneously. The impact extends beyond prices to the physical availability of materials, potentially suppressing factory utilization rates and disrupting production continuity.

“In the short term, this condition could trigger a domino effect, including longer lead times, higher production costs, and increased pressure on product prices in the market,” he stressed.

Without swift and coordinated mitigation measures, these raw material supply disruptions risk becoming a structural constraint on Indonesia’s industrial growth.

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