JAKARTA: Trade Minister Lembong detects a rising trend in Indonesia’s coffee exports over the past two years and therefore is optimistic this commodity will become increasingly important for Southeast Asia’s largest economy in terms of foreign exchange earnings. In 2015 the value of Indonesia’s coffee exports reached USD $1.19 billion, up 15.2 percent (y/y) from the preceding year, while the nation’s total non-oil & gas exports declined by 14 percent (y/y) over the same period. This shows that coffee has posted a remarkable performance in terms of export. In order to improve coffee exports, Lembong emphasizes the nation’s coffee industry needs further development, ranging from improvements at the harvest stage to marketing and brand awareness.
Development of the domestic coffee industry would also imply that the welfare of Indonesian coffee farmers improves. Lembong added that the Indonesian government is well aware of its key role in developing the coffee industry. Currently, infrastructure bottlenecks as well as problems related to the trade system and institutional matters hamper more rapid development of the coffee industry.
By participating in the Specialty Coffee Association of America (SCAA) Expo 2016, Indonesia aims to improve global awareness of Indonesian coffee. Although Indonesia is among the world’s top four of largest coffee producers and exporters, there still is low awareness of Indonesian coffee among the globe’s coffee consumers, Lembong said.
Pranoto Soenarto, Head of the Specialty Coffee and Industry Division within the Association of Indonesian Coffee Exporters and Industries (AEKI), expects Indonesia’s coffee production to reach 600,000 – 700,000 tons in 2016, up 27 percent (y/y) from 550,000 tons of coffee in 2015. Whereas last year Indonesia’s coffee production was plagued by unconducive weather, this year the nation’s coffee harvests are expected to be solid. This implies Soenarto sees limited impact of the El Nino weather pattern on coffee production, whereas production of other commodities – for example crude palm oil (CPO) – experience falling production figures due to prolonged (El Nino-inflicted) dry weather.
Regarding Indonesia’s coffee exports, Soenarto targets an export figure around 400,000 tons of coffee (worth approx. USD $1.5 billion) this year. Indonesia’s largest export markets for coffee are the United States (23.5 percent), Japan (8.7 percent), Germany (7.4 percent), Italy (7 percent), and Malaysia (5.9 percent).
