Cocoa Farmers Push for Local Chocolate Industry

Jakarta Globe, Arti Ekawati, February 03, 2010

A farmer picks cocoa at the Rangkahpawon plantation, Kediri, East Java. (Photo: Arief Priyono, Antara)

The Indonesian Cocoa Association is urging the government to promote the domestic production of chocolate food and beverages as part of a plan to reduce exports of unprocessed cocoa beans and develop value-added production.

Zulhefi Sikumbang, general secretary of the association, known as Askindo, said the development of domestic producers of chocolate-flavored food and beverages would help boost cocoa processing. He said Askindo has asked the government to offer incentives such as low-interest bank loans and to develop the nation’s infrastructure, especially its power system.

“It would raise the demand for cocoa beans from farmers and gradually reduce our export volume of [unprocessed] cocoa beans,” Zulhefi said on Wednesday in Jakarta.

The government announced last month that it was preparing incentives to develop value-added industries that process agricultural products.

Deputy Agriculture Minister Bayu Krisnamurthi said the government wanted to develop downstream industries to boost employment and add value to exports, which are mostly unprocessed raw materials. “The incentive scheme will be different for each commodity,” Bayu said.

Indonesia exported 400,000 of the 600,000 tons of cocoa beans it produced last year. Most of these dried, unfermented cocoa beans are sent to countries such as Singapore and Malaysia, where they are processed into chocolate-flavored food and beverages and exported, often back to Indonesia.

The value of the country’s cocoa exports in 2009 was estimated at $1.8 billion, a 20 percent increase over the previous year, according to Bloomberg.