My name is Greg. I have 10+ years of experience in shisha charcoal manufacturing and exporting. In this article, I will show you a charcoal factory insider calculation of how much profit shisha charcoal factories in Indonesia are making. This article will be of interest to wholesale bulk buyers of shisha charcoal.
Briquettes manufacturing
Here is the basic summary of the cost of manufacturing shisha charcoal briquettes. Pay attention that there are a lot of variables that influence the price (and below I try to explain it all).
Table 1. How much is the selling price of shisha charcoal depending on the raw material price and manufacturer margin
| Raw material price in USD | Marging Profit Before Tax | |
| 10% | 20% | |
| $1,000 | $1,908 | $1,996 |
| $900 | $1,696 | $1,850 |
| $800 | $1,563 | $1,705 |
| $700 | $1,429 | $1,559 |
Table 2. How much charcoal factory get per ton in USD
| Raw material price in USD | Marging Profit Before Tax | |
| 10% | 20% | |
| $1,000 | $191 | $399 |
| $900 | $170 | $370 |
| $800 | $156 | $341 |
| $700 | $143 | $312 |
So, basically, from each ton, the manufacturer can make from 150 to 350 USD per ton. Again, this is EBITDA, not the clean income of the factory. Note that we have to assume that about 5 to10% of production can fail, and we need to remanufacture it.
This is a link to Google Sheets profit calculator of coconut shell charcoal birquettes factory. You can copy it and simulate different raw material price and margin to understand how much your manufacturer is getting and profit.
https://docs.google.com/spreadsheets/d/1s-hI0LIuLagxFEv6Ooihbrkcp_4O8DNDvW8kUTWvXhk/edit?usp=sharing
Our assumption is that the raw material (carbonized coconut shell charcoal) we receive at the factory gate has a price of Rp 13500 per kg and the quality is according to our standard (moisture is 12-13%, ash content is less of 2.5%, color of charcoal is natural white, without dark, yellow, red spots).
For the manufacturing raw material itself (carbonization process), I have written a different article, as it is a different business process.
Receiving and processing raw material
Ok, lets assume that we have received well-carbonized coconut shells at our factory in Magelang.
The first step will be to check moisture, ash content, and color of the ash. Remember that after oven drying, our briquettes need to have at least 3-4% moisture content. So if we receive raw material too wet, it is a loss for us.
Our standard for raw material is 12-13% moisture. If we get higher moisture, it means that we are buying water instead of charcoal. It can be heavy, but because of the water, not because of the raw material.
Raw material moisture problem
For example, we receive coconut shell charcoal with moisture of 18% instead of our standard acceptable 12%. The difference is 6%. It means that in one ton we get just 940 kg of charcoal, and 60 kg of water.
Another problem is that if the moisture of charcoal is high, we cannot clean it from the dust. The small particles “glued” to the main charcoal shell bodies. So, on one hand, we do not have much waste during the rotary cleaning, but on the other hand, we get very high ash.
If the charcoal is dry (12-13%) – dust easily falls down during rotary cleaning and makes our shisha charcoal at 1.6-1.9%.
Ok, so if the raw material is too wet, we get problems with high ash and less material. We need to dry it.
Drying is an additional cost. We can dry it under the sun, but with risk of sudden rain or dirt mixed up with the material. Or in the ovens – but ovens become full of charcoal residue, and we lose a lot of material too.
At our factory, we are using gas-powered rotary kiln ovens for drying raw material, so we are not influenced by rain, weather or dust from the outside.
Rotary Cleaning & Grinding
This is a critical step to make sure our charcoal contains the proper ash content. The more we clean it, the less ash we get, but more residue will fall down, meaning we are losing material and the price is goes up.
For sure, we have to clean from foreign matter, like plastic, dirt, metal scrap, and so on.
At our charcoal factory in Magelang for Platinum grade, we do 3 to 5 cleaning processes, losing about 15-40% of the material, but getting extremely high-quality, low-ash charcoal. The range is very high, as it depends on the type of rotary (for example, we are using 3×6 meters long rotary cleaners with 3 mm holes), plus cleaning tables with a shaking mechanism.
After rotary cleaning, we have to process grinding – making small particles that will stick to each other, and we can make shapes such as cubes, hexagons, fingers, and so on.
During grinding, we will lose from 1 to 3% of the material.
Mixing, Blending
Mixing is the process of mixing our ground charcoal mesh with water and tapioca. If the factories are adding some chemicals (for example, liquid glass [sodium silicate Na₂SiO₃], Opaque [Titanium Dioxide] or other chemicals). Our factory is not using chemicals for shisha charcoal production.
Then comes blending, where we heat up and squeeze tapioca with coconut shell charcoal to get the “cake dough” for our charcoal. Many factories make only one or two runs of the blending process, while our factory is making 3 to 5 runs for blending, making sure that all material is fully mixed and heated. But again, it is additional electricity cost, plus more cost for maintenance.
Extrusion & Cutting
Most of the charcoal is manufactured by extrusion method, so we need to use high-pressure extrusion equipment and extra sharp circling knifes for cutting.
For sure on each step we are losing 0.5-1% of the material as waste.
Oven drying
This is a very variable (in terms of cost) procedure. As we can use gas, electric, wood pellet or wood ovens. All of those types have pros and cons. For example, electric & gas ovens are easy to control temperature, but operational cost if very high. On the other hand, wood pellets and wood ovens are much more difficult to control the temperature, but it wins on the operating cost. So we can use it longer, making sure our charcoal is completely dry, and neglecting operating cost.
Final Calculation
All calculations we will make in Rupiah, as all materials we are buying in Indonesian Rupiah, and the final number we convert to USD.
- Cost of raw material: Rp13500 (as per our assumption) per kg. Also need to note that factories usually use several sources of the raw material, so the price for raw material can be different from different sources.
- Loss of material during production: 25%
- Loading & unloading from truck: Rp 50 per kg
- Tapioca (very variable; current cost is Rp 650 per kg of charcoal, but sometimes it can be half of this price)
- Oven cost: assume we are using a 5-ton oven; with wood pellet or wood oven, it will cost us Rp 200 per 1 kg
- Worker salary: assuming we are paying minimum salary, as our factory is located in Central Java, at the moment of this calculation it is Rp 2,327,386 per month.
We need approx. 25 workers on the production floor, plus packing team, plus oven team, plus crusher and grinding, mechanics, QC team, head of production, head of mechanics, security, cleaning, and so on. So in total we need about 50-60 workers to do the job.
Note that the head of production, mechanics, and QC will have much higher salaries (usually 3-5 times higher than workers).
Assuming we are making 150 tons per month, it will make us about Rp 150 per 1 kg. Do not forget, if we make a hexagonal shape, it will cost more, as the speed of extrusion, cutting, and drying is longer for hexagonal, compared to the cube shape
Producing one ton of export-grade coconut shisha charcoal costs about $1,455 (Rp 24,734/kg) at Rp 13,500/kg raw material and Rp 17,000/USD. At a 25% margin the factory sells at about $1,819/t and keeps roughly $364/t before tax.
Producing one ton of export-grade coconut shisha charcoal costs about $1,455 (Rp 24,734/kg) at Rp 13,500/kg raw material (verified 15 July 2026; factory model).
At a 25% margin the factory selling price is about $1,819/t, of which roughly $364/t is factory EBITDA (verified 15 July 2026).
Raw material is about 68% of total factory cost once the 25% production material loss is counted (verified 15 July 2026).
| Cost line | Rp / kg finished | ≈ USD / t |
|---|---|---|
| Raw material — carbonized coconut shell (Rp 13,500/kg + 25% production loss) | Rp 16,875 | $993 |
| Unloading from truck (+ 25% loss) | Rp 63 | $4 |
| Tapioca binder | Rp 616 | $36 |
| Oven drying (wood-pellet) | Rp 200 | $12 |
| Production wages | Rp 1,850 | $109 |
| Container stuffing | Rp 50 | $3 |
| Electricity | Rp 500 | $29 |
| Maintenance | Rp 350 | $21 |
| Office & misc | Rp 750 | $44 |
| Production subtotal | Rp 21,254 | $1,250 |
| Inner plastic bag | Rp 300 | $18 |
| Labour — inner plastic | Rp 300 | $18 |
| Inner box | Rp 1,825 | $107 |
| Labour — inner box | Rp 150 | $9 |
| Master box | Rp 650 | $38 |
| Labour — master box | Rp 100 | $6 |
| Sticker | Rp 105 | $6 |
| Silica gel | Rp 50 | $3 |
| Packaging subtotal | Rp 3,480 | $205 |
| Total factory cost | Rp 24,734 | $1,455 |
| Factory margin (25% on cost) | — | $364 |
| Factory selling price | — | $1,819 |
Per-kg costs of finished charcoal. Raw material and truck unloading carry the 25% material lost in cleaning, grinding and drying — you buy more shell than you sell as briquette.
Selling price by raw-material price and margin
| Raw material | 10% margin | 15% margin | 20% margin | 25% margin |
|---|---|---|---|---|
| Rp 12,000/kg | $1,479 | $1,546 | $1,614 | $1,681 |
| Rp 13,500/kg | $1,600 | $1,673 | $1,746 | $1,819 |
| Rp 15,000/kg | $1,722 | $1,800 | $1,878 | $1,957 |
| Rp 17,000/kg | $1,883 | $1,969 | $2,055 | $2,140 |
At Rp 17,000/USD, packaging included. Margin applied as a markup on cost.
What the factory actually keeps
| Raw material | 10% margin | 15% margin | 20% margin | 25% margin |
|---|---|---|---|---|
| Rp 12,000/kg | $134 | $202 | $269 | $336 |
| Rp 13,500/kg | $145 | $218 | $291 | $364 |
| Rp 15,000/kg | $157 | $235 | $313 | $391 |
| Rp 17,000/kg | $171 | $257 | $342 | $428 |
EBITDA, not net income — 5–10% of production typically fails and must be remanufactured.
How this is calculated
Every input is bought in Indonesian rupiah, so the model works per kg of finished charcoal in IDR and converts to USD per ton at the end. Raw material and truck unloading are multiplied by 1.25 because 25% of the material is lost to rotary cleaning, grinding, extrusion waste and drying. Fixed lines — tapioca binder, oven fuel, wages, container stuffing, electricity, maintenance and office — are added per kg, then retail packaging (inner plastic, printed inner boxes, master carton, stickers, silica gel and their labour).
The margin is a markup on cost: selling price = cost × (1 + margin). What the factory keeps is EBITDA before tax; 5–10% of production typically fails QC and is remanufactured, and equipment financing sits outside this model. Cleaner grades lose more material — see the price-to-grade check for how loss changes the standard price per grade.
Frequently asked questions
How much does it cost to produce shisha charcoal?
About $1,455 per ton (Rp 24,734/kg) all-in at the factory — raw material at Rp 13,500/kg including the 25% production loss, plus binder, fuel, wages, electricity and retail packaging.
How much profit does a shisha charcoal factory make per ton?
At a 25% margin on cost, about $364 per ton EBITDA before tax. Across common margins the range is roughly $145–$364/t — and 5–10% of production fails and is remade.
Why does the raw-material price matter so much?
Carbonized coconut shell is about 68% of total factory cost, and every kilogram of finished charcoal needs 1.25 kg of it because of the 25% production loss. A Rp 1,500/kg move in raw material shifts the selling price by roughly $138/t.
Run the factory model yourself
Change the raw-material price, exchange rate and margin to see cost, price and profit.
Last verified 15 July 2026. Figures are illustrative industry ranges, not quotes — verify before relying on them. Freight and the US–Indonesia tariff change most often.
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