Indonesian textile production plant closes permanently

Indonesian textile company PT Asia Pacific Fibers Tbk (POLY) has announced the permanent closure of its plant in Karawang, whose chemical and fiber production units have been suspended since November 1, 2024, this time permanently.Reasons for the closure include weak demand for industrial products in domestic and foreign markets, global overcapacity, rising tariffs on exports to the U.S., and climbing raw material prices; and unstable domestic policies, such as theanti-dumping dutyImplementation and revisions to import regulations have not met expectations; plant shutdowns have exceeded six months, making restart of the facility technically and commercially unfeasible and costly to maintain; and debt restructuring negotiations with the Ministry of Finance have taken longer than expected, with no final agreement yet reached. The short term will result in lower sales revenue in 2025 and beyond and the company will need to revise its financial expectations accordingly. The company has shifted its focus to the Kaliwungu plant, with plans to restructure its product mix and supporting resources; it continues to move forward with debt restructuring and seeks to reach an agreement with creditors and investors in order to obtain funding to increase production capacity; and it is appealing for the support and cooperation of all relevant parties and stakeholders in order to safeguard the company's operations in the long term.