East Kalimantan – The government has secured the allocation of subsidized fertilizer as part of its strategy to maintain national food security and self-sufficiency by setting the allocation of subsidized fertilizer in 2026 at 9.55 million to 9.8 million tons for the agriculture and fisheries sectors, with a total budget of IDR 46.87 trillion.
This policy is reinforced by ongoing modernization efforts by state-owned enterprises in the fertilizer industry. One of the most recent efforts was demonstrated by the inauguration of PT Pupuk Indonesia (Persero)’s revamping of Ammonia Factory 2 at PT Pupuk Kalimantan Timur (Pupuk Kaltim). The modernization of this oldest factory is considered a crucial foundation for ensuring a steady supply of subsidized fertilizer for farmers throughout Indonesia.
The revamping was carried out at the plant, which has been operating since 1984 and has been one of the backbones of Pupuk Kaltim’s production, with a capacity of 595,000 tons of ammonia and 570,000 tons of urea per year. The rejuvenation project included the replacement of key equipment and process upgrades to the shift converter, ammonia converter, and CO2 removal system. The plant is also now supported by an automated Distributed Control System (DCS) that enables more precise control and real-time monitoring.
The President Director of Pupuk Indonesia, Rahmad Pribadi, said that modernization has had a major impact on production efficiency.
“The modernization of Factory 2 has reduced gas consumption by 4 MMBtu per ton of ammonia, or more than 10 percent compared to the previous year. This makes production more cost-effective and simultaneously reduces carbon emissions by up to 110,000 tons of CO2 per year,” he said.
He emphasized that this step is part of the country’s grand vision of building an independent fertilizer industry.
“The modernization of this factory reflects the country’s grand vision of building an independent fertilizer industry as a foundation for sustainable food self-sufficiency,” Rahmad said.
The project, which began in November 2023, is also expected to extend the plant’s operational life by up to 15 years. Its implementation is supported by Presidential Regulation No. 113 of 2025, which accelerates the revitalization of the national fertilizer industry through a more adaptive subsidy scheme, ensuring continued modernization without disrupting the distribution of subsidized fertilizer.
Pupuk Kaltim President Director, Gusrizal, assessed that revamping has strategic value for production sustainability.
“Through digitalization and the latest technology, the factory now operates more efficiently and optimally, ensuring the sustainable fulfillment of national fertilizer raw material needs,” he said.
He added that this is a long-term investment.
“This modernization is a long-term investment to make production more efficient and environmentally friendly, while also maintaining the national fertilizer supply.”
Appreciation also came from the Minister of Agriculture, Andi Amran Sulaiman.
“This achievement aligns with the President’s directive to revitalize the national fertilizer industry. If we want to become the world’s food barn, the fertilizer industry must be strong,” he said.
Similar support was conveyed by the Chairperson of Commission IV of the Indonesian House of Representatives, Siti Hediati Soeharto, who emphasized that the sustainability of the fertilizer industry is directly related to the fate of farmers.
Going forward, Pupuk Indonesia is targeting the revitalization of six other factories by 2029, including Pusri 3B, NPK Phonska VI Petrokimia Gresik, Amurea PIM III Factory, and the Fakfak Fertilizer Industrial Estate. These efforts are expected to strengthen national production capacity so that the policy of locking subsidized fertilizers truly supports the achievement of food self-sufficiency.
