The Indonesian petrochemicals market is set to be among the most dynamic in the Asia Pacific region, prompting growth in local capacity, according to BMI's latest Indonesia Petrochemicals report. However, new plants will be insufficient to keep up with demand, with the market requiring significant imports over coming years.
Demand from the local petrochemicals industry will come from the domestic market rather than exports. The country is seeing a growing consumer base and rising investment which is stimulating domestic petrochemicals demand, but there are underlying uncertainties due to non-conducive monetary conditions and political headwinds. Nevertheless, over the long term, population growth, the development of a large consumer base and accelerating investment should sustain strong market growth in the petrochemicals sector.