Magelang, 19 December 2025 – Coordinating Minister for Food Affairs Zulkifli Hasan (Zulhas) stated that Presidential Regulation (Perpres) Number 113 of 2025 on the Governance of Subsidized Fertilizers will improve the efficiency of the national fertilizer industry. The regulation also serves as a response to the evaluation issued by the Supreme Audit Agency (BPK) regarding inefficiencies in the fertilizer industry published some time ago.

“It started with BPK, then was followed up by Pupuk Indonesia through a number of studies, and subsequently proposed to the Government. The President agreed, and thus Perpres 113 was issued,” said Zulhas.

Perpres 113/2025 is an enhancement of Perpres 6/2025. One of the key changes stipulated in the new regulation concerns the payment scheme for the procurement of raw materials for subsidized fertilizers, whereby the Government will disburse payments upfront—prior to the production and distribution of subsidized fertilizers—following a prior review by BPK.

With this change, Pupuk Indonesia will no longer bear interest expenses related to working capital financing for raw material procurement.
“The subsidy remains in place. With the issuance of Perpres 113, the subsidy can be utilized upfront, so there is no need to pay interest—what a waste it would be otherwise!” Zulhas emphasized.

This change also ensures that the procurement of raw materials and fertilizer production processes are aligned with BPK provisions and recommendations.

Furthermore, Zulhas expressed confidence that with the enactment of Perpres 113/2025, Pupuk Indonesia’s performance will become more efficient. With the current level of subsidies allocated by the Government, Pupuk Indonesia will not only distribute subsidized fertilizers in accordance with the 7 Right Principles (right target, type, quantity, price, time, place, and quality), but the resulting efficiency gains will also enable a reduction in the Highest Retail Price (HET) and support the construction of seven new plants over the next five years.

“Fertilizer plants are very old—some are already 50 years old. That’s why they need to be replaced with new ones to improve efficiency, reduce prices, and ultimately allow farmers to enjoy the benefits,” Zulhas said.

At the same event, President Director of Pupuk Indonesia, Rahmad Pribadi, stated that 2025 marks many historic milestones achieved by the Government. Thanks to policy changes in distribution, farmers across Indonesia were able, for the first time, to redeem subsidized fertilizers starting on 1 January.

“Furthermore, the issuance of Perpres 6/2025 provided room for Pupuk Indonesia to operate more efficiently. Those efficiency gains were then passed on to farmers in the form of a 20 percent discount on the Highest Retail Price (HET),” he said.

Rahmad also expressed appreciation for the Government’s continued support for efficiency through the issuance of Perpres 113/2025 as a refinement of Perpres 6/2025. In addition, Pupuk Indonesia is committed to implementing BPK recommendations as outlined in the Summary of Semester Audit Results (IHPS) I 2025, covering the audit period from 2022 to the first semester of 2024.

According to Rahmad, these recommendations serve as important input for the company to strengthen governance and ensure that its contribution to national food security remains optimal.