This research was conducted to : (1) to analyze raw material ordering practices and the total costs incurred under the company's current inventory policy; (2) to calculate the optimal order quantity and total inventory using the Economic Order Quantity (EOQ) method; (3) to determine the appropriate level of safety stock required; (4) to identify the reorder point for raw material procurement; and (5) to evaluate the efficiency of the EOQ method in raw material inventory management for optimizing production costs.

The object of this study is PT Hutan Rindang Banua, located in Tanah Bumbu Regency, South Kalimantan. This research employs a descriptive quantitative approach using both primary and secondary data sources. Primary data were collected through direct observation at the research site and interviews, while secondary data were obtained from records of raw material orders, raw material usage, and other cost-related data from the year 2023. Data analysis was conducted based on the company’s inventory policies and calculations using the Economic Order Quantity (EOQ) method.

The results of this study show that the calculation from the Economic Order Quantity (EOQ) method in 2023 is 2,944.71 m3 with an order frequency of 3 times. The Safety Stock of log wood provided is 225 m3 and ROP is 2,009 m3. The TIC obtained from the calculation of the Economic Order Quantity EOQ method at PT. Hutan Rindang Banua in 2023 amounts to IDR 588,439,376.

Keywords : Economic Order Quantity, Safety Stock, and Reorder Point