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JAKARTA. The rumors about a rise in cigarette prices to IDR 50,000 per pack were seriously responded by retailers. It was reported demands of cigarettes rose after the panic retailers went on panic buying in anticipating the price rise.
However, according to Corporate Secretary of PT Wismilak Inti Makmur Tbk Suryanto Yaseputra, the rise on cigarette demands only occured at retail level, not at wholsale level. Therefore, the panic buying has insignificantly affected overall cigarette price.
During the first six months of 2016, Wismilak recorded a 3% increase in sale of shares to IDR 902.65 billion. However, this performance was not resulted from the panic buying, since rumors about cigarette price rise just circulated during the second semester of 2016.
Analyst from Minna Padi Investama Frederik Rasali predicted that the increase in cigarette price caused by panic buying did not exceed 10% of cigarette sales during normal period.
Secretary General of the Indonesian Cigarettes Manufacturers Association Hasan Aoni Azis admitted that panic buying occurred recently. However, he assumed that the recent increase of the cigarette demands has insignificant effect to cigarette producers. “It is proven that the cigarette prices did not increase”, Hasan said.
Hasan added that a week after the panic buying, the demand has decreased since a price rise to IDR50,000 did not occur.
PT Bentoel International Investama Tbk dismissed the information about panic buying. “The cigarette prices at wholesale market level remain stable”, Head of Legal and External Affairs of PT Bentoel Investama Mercy Fransisca told Kontan on Wednesday (7/9).
According to Mercy, the rumor about cigarette price rise to IDR50,000 has created uneasiness among many people, mainly those who work in cigarette industry. Recently, cigarette industry absorbs 6 million of employees. (Translator: Muhammad Farid)
