Mondi, a global leader in sustainable packaging and paper, is expanding its paper bags business in Southeast Asia through a joint venture with PT Indocement Tunggal Prakarsa, one of the largest cement producers in Indonesia.
The joint venture, PT Mondi Indo Prakarsa Kemasan, will be located at Indocement’s Cement Factory Complex in Citeureup, West Java, Indonesia and will initially produce paper bags for Indocement, serving the growing local market demand for paper bags in Southeast Asia. Mondi will own a 60% stake, with Indocement owning the remaining 40%. Indocement will act as the anchor customer of the joint venture, providing long-term volume stability.
Southeast Asia is characterized by sustained construction demand, making it an attractive long-term growth market for paper bags. The joint venture reflects Mondi’s strategy to expand its paper bags footprint and build scalable platforms in structurally growing markets such as Southeast Asia, where market fundamentals remain attractive. Through this new joint venture, Mondi establishes a majority-owned local production platform in Indonesia, strengthening its regional presence while benefiting from Indocement’s strong local market position and customer base.
“This joint venture is an excellent strategic fit for our paper bags business. It allows us to establish a strong local platform in a structurally growing market, underpinned by a reliable long-term customer. At the same time, it provides a clear pathway for scalable growth while applying Mondi’s high standards in operational excellence, safety and quality,” says Claudio Fedalto, chief operating officer, paper bags at Mondi.
Co-location at the Citeureup Cement Factory Complex enables close operational integration, efficiency gains and reliable execution. Mondi will install an additional paper bags production line alongside the existing one to further support efficient operations and create a strong base to expand activities in Southeast Asia, adding over 200 million paper bags to Mondi’s global production footprint. The joint venture is expected to be operational towards the end of 2026, subject to the completion of all commercial, operational, and legal preparations.
