Wood panel manufacturer PT Indonesia Fibreboard Industry Tbk (IFII) anticipates challenges in exporting processed wood products this year despite maintaining a positive outlook. IFII's corporate secretary, Evan Kristian, attributed potential export slowdowns to ongoing global uncertainties, noting subdued demand in various export destinations, such as Japan, due to its sluggish economy. However, demand for Medium Density Fiberboard (MDF) remains stable and continues to grow in the Middle East region. Evan highlighted the commencement of additional production facilities, particularly MDF Line II in April 2023, as a key driver for this year's performance improvement. With increased production capacity, IFII aims to meet export demands from Middle Eastern countries, previously limited by production capacity constraints.

Although profit margins from Middle Eastern exports may be lower compared to other regions, IFII expects higher sales volumes to compensate for any potential margin losses resulting from declining exports to primary destinations like Japan. The company also seeks to expand into new export markets, including the United States, Africa, and Europe, while carefully considering sales margin implications. In response to current global conditions, IFII is implementing proactive measures to safeguard overall profit margins, including adjusting product prices to maintain margin compositions. To boost performance, IFII has allocated a Rp 50 billion capital expenditure budget for maintenance, expansion, and procurement of new office units. As of the third quarter of 2023, IFII's net sales increased by 6.46% year-on-year to IDR 682.95 billion, while net profit decreased by 17.25% year-on-year to IDR 62.51 billion. These figures reflect the company's ongoing efforts to navigate challenging market conditions while pursuing growth opportunities both domestically and internationally.

Source: https://insight.kontan.co.id/news/ifii-genjot-ekspor-olahan-kayu-ke-timur-tengah