PT PABRIK KERTAS TJIWI KIMIA

CONVERTING PRODUCTS

Pabrik Kertas Tjiwi Kimia , Tbk – Mojokerto

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Company Profile
The Mill:
Incorporated : October 2, 1972
Plant site : 300 hectares
Location : Sidoarjo, East Java
Operation : 24/7 all year round in 3 shifts

Operating Divisions:
Chemical Factory, Paper Factory,
Converting Factory, Power Plant

Manpower:
Approximately 8,612 employees

Factory Audit:
ISO 9001 : 2015 - Paper Mill (Quality Management System)
ISO 14001 : 2015 - Paper Mill (Quality Environmetal Management System)
SVLK – Holders of Downstream timber Industry
SMK3 - Government of Indonesia - Paper Mill (Occupational Health &
Safety Management)
Programme for Endorsement of Forest Certification Schemes
Blue PROPER - Government of Indonesia - Paper Mill.
(PEFC)
OHSAS 18001:2007 - Occupational health and safety management
systems

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APP Sustainability Roadmap:
Vision 2020
Key Area of Focus
Carbon emissions and
sequestration

Production
Biodiversity and Environmental
habitat protection Impact

Social, economic 3rd Party

and human rights Certifications

Responsible Sourcing
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APP Forest Conservation Policy (FCP)

A commitment to erase deforestation throughout our supply chain

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APP Forest Conservation Policy (FCP)

APP Supports Responsible Forest Management

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APP Forest Conservation Policy (FCP)

The Advancement of Certifications

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APP Forest Conservation Policy (FCP)
Participation in International Forum

APP participated at UNFCCC COP21

Paris 2015 and COP22 Marrakech 2016
for multi-stakeholder approach to
tackle deforestation and climate
change.

NY Declaration 2014
APP the only pulp & paper company
that supports NY Declaration on Forests
at the UN Climate Change Summit

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APP Forest Conservation Policy (FCP)
Moving Forward

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Tjiwi Kimia Friendly Manufacturing
Environmental Sustainability
Fresh Water Supply Waste Water Treatment Plant

Operated since 1989

Modification : 1997
Unit I capacity : 30,000 m3/d Process operation : physical, chemical and
Unit II capacity : 37,000 m3/d biological (activated sludge)
Unit III capacity : 50,000 m3/d Capacity : 64,000 m3/day

Water Intake Sedimentation Clarifier Equalization Primary Biological

Pond Clarifier Treatment

Filtration Reservoir Paper Machine Secondary Effluent Pond Effluent to

Clarifier the River

Tank Tank

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Tjiwi Kimia Friendly Manufacturing
Air Emission Control Emission Control for Vehicle
from Power Plant
Electrostatic Precipitator (ESP) Ash Silo

Boiler Sludge for Solid Multi Block Nachine for

Waste Treatment Reuse Bottom Ash

CAPACITY = 700 CYCLE/ 8 h

Design Capacity : 365 T paper FINISHED PRODUCT:
sludge/day 1.* PAVING BLOCK
System : Fluidized Bed
2.* BATAKO
Fuel : Coal & HFO
Operated : 2006 3.* KANSTEIN
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Tjiwi Kimia Friendly Manufacturing
Temporary Storage of Hazardous Waste
(Permit : Kep. Bup. Sidoarjo No. 188/976/404.1.3.2/2016)

TPS Sludge IPAL TPS Fly Ash TPS LB3 others TPS Fly Ash & Bottom Ash

Hazardous waste transport to Third party with License

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Tjiwi Kimia Friendly Manufacturing
Greenery Program inside the Factory Certification

PEFC

PEFC

Ecolabel ISO 14001

OHSAS 18001 ISO 9001 12

US Market Business Overview
General Market Overview School & Office Supplies

The US stationery market is ~US$ 3 – 3.5 Bn (supplier’s value), with ~ 1,100K – 1,300K MT
volume per year
(include dated planner, fashion notebook, padded envelope, sticky note)

Growth:
Overall US paper stationery market is on the decline, due to increased digitalization
Office consumables are the largest market segment, driven by envelopes (US$2-2.2Bn, 500- 600K MT) but are on a
rapid decline
The school writing surfaces segment is mostly commoditized, though there is growth in the low volume-high
value personal writing surfaces

The US stationery market is mostly commoditized, with growth only in dated planners and
professional notebooks

Channel structure varies across product segments, they are B2B (Contract) & B2C (Retail)

Retail: Manufacturers usually sell directly to the retail channel, in which Office super stores and
Hypermarkets dominate
Player: Hypermarket, Office Superstores, Warehouse Club, Dollarstores
Online Platforms: Amazon, eBay

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Stationery Business Overview
PRICE
Price Fluctuation in the past 2 years were stable, going forward price will relatively
increase following global paper price increment.

Paper Price is the main component which drive price

Since TK produce paper raw material in house, thus the benefit are TK price for converted product is more competitive and
index of on time delivery is 95 – 100%

MANUFACTURING
Countries of Production: Indonesia (Tjiwi Kimia)

Import Duty: No Import Duty from Indonesia for Converted Product

Competitors: India, China

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Stationery Business Overview
PRODUCT
US school and office supplies products mostly are commoditized, though there is a
recent trend towards value-added designs (using PP cover)

Commoditized products have high private label salience; amongst channels, office
superstores and drugstores over-trade on PL
TK has experience to supply numbers of US Big Retailers with their private brand requirements.

TK also develop mill brand (Inspira) for value-added designs to show existence in US market
as well as showing manufacturing development capability.

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Stationery Business Overview
TK participation in US market (School and Office Supplies)

The US stationery market is ~US$ around 1 Bn (supplier’s value), with ~ 300K -

380K MT volume per year
(exclude dated planner, fashion notebook, padded envelope, sticky note)
TK Share: around 5%

Despite the paper decline due to digitalization, TK growth is positive from 2011
since ADD for Indonesia was revoked

Capacity vs demand:
TK Capacity for converted product is around 280,000 MT/Year.

Market Competitiveness:
TK have been supplying to Office Superstores, Dollar Stores, Distributor across US.

Trends:
For commoditized products, trends are moving to value-added designs (fancy covers, poly covers, dividers)

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Product Line Converted Product
CONVERTING 1
School Product

1,230,000 pcs/month 4,738,500 pcs/month 3,830,760 pcs/month

TK Run Automatic and Semi-automatic production line which

support efficient cost, big capacity and on time delivery.

Negotiations for 2018 Back-to-School contracts began in

August 2017, with commitments required by Nov 2016
Capacity will be fully occupied during 1st half 2018
Available capacity for Target will depends on negotiation in August
2017

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Product Line Converted Product
CONVERTING 2
Office Product

5,000,000 pcs/month 545,000 pcs/month 1,150 MT/month 2,250,000 pcs/month

TK Run Automatic and Semi-automatic production line which

support efficient cost, big capacity and on time delivery.

Capacity Occupation is tends to stable throughout the year

We need commitment and forecast to allocate production space
Available capacity for Target will depends on negotiation in August
2017

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Product Line Converted Product
CONVERTING 3
Shopping Bag

Specification:
1. Art Paper 80, 120, 130, 150, 170 gsm
2. Box Board 210, 230 gsm
3. White Kraft 120, 150, 180, 210 gsm
4. Brown Kraft 90, 150, 200 gsm

Value Added Option:

1. Gloss/Matte/Foil Lamination
2. Hotstamp
3. Embossing / Debossing (Partial/Overall)
4. Silkscreen
5. Spot UV

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Relationship with Target
2007 - 2010
Retail Envelope

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Question & Answer

Thank You

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