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NEWS UPDATES Asean Affairs        20  June 2011

Coffee plantations expand in Indonesia

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Coffee growers in Indonesia, the world’s third-largest coffee producer, have said they are looking to increase the size of their plantations to help make up for two years of falling production.

By increasing acreage, the growers say they hope to boost output, which is expected to be about 600,000 tons this year, by at least 50 percent by 2021.

“We will cooperate with the relevant ministries to prepare the land required to expand coffee plantations for farmers so that in the coming 10 years, production can reach 900,000 tons to 1.2 million tons per annum,” said Pranoto Soenarto, deputy chairman for specialty coffee and industry at the Indonesian Coffee Exporters Association (AEKI).

Although he declined to elaborate on how much land was needed for the expansion, Pranoto said the increased acreage would also lead to better quality beans. “We want to increase the quality and quantity of production by increasing plantation acreage and using organic fertilizers,” he said.

Presently, he said, the country’s coffee plantations covered 1.2 million hectares, with more than 90 percent being cultivated by small-scale producers.

Production is expected to fall well below previous estimates. Earlier this year, AEKI predicted coffee production would reach 700,000 tons, but that was later revised to just 600,000 tons, 7 percent down on output from 2010.

“Last year, the country’s coffee production was about 640,000 tons,” AEKI chairman Suyanto Husein said on Friday.

He said unseasonal rains were the main reason for the shortfall. “There is an indication of decreasing production in a number of production centers in various regions due to bad weather,” he said.

But he said the dip was also due in part to lagging efforts to rejuvenate old plantations and launch intensification programs, which was why AEKI supported expanding acreage to increase production.

Aside from the drop in production, AEKI has also predicted a decline in the country’s coffee exports this year.

The association said exports in 2011 would reach only about 390,000 tons, down from last year’s figure of more than 440,000 tons.

But while the decline in production was a factor in the decrease in exports, Suyanto said the drop was also caused by increased domestic consumption.

According to AEKI data, coffee bean exports for 2010 reached 443,969 tons, worth $791.76 million. The association, however, had predicted early last year that export volumes for 2010 would drop to 325,000 tons, worth $650 million per annum, from 400,000 tons, at $773 million.

Indonesia’s traditional coffee export markets, especially for robusta coffee, include Japan, South Africa, Europe and South and Central American countries. Its arabica coffee, meanwhile, was mainly exported to Germany and the United States.

The trial is ongoing.


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