STATE OF THE ART INNOVATION and

TECHNOLOGY TRANSFER of CANEPHORA in THE

MAIN PRODUCTION COUNTRIES OF THE WORLD

INDONESIA

By

Pranoto Soenarto

Association of Indonesian Coffee

Exporters And Industries (AEKI/AICE)

INTERNATIONAL CONFERENCE COFFEE CANEPHORA

June 12, 2012, at Vitoria Convention Center, Vitoria - ES

Role of Coffee on the Indonesia Economics

Main source income for some 2 million farmer’s families in the remote areas

Share to GNP : 10,7 % to GNP Agriculture 0,57 % to GNP Non oil & gas 0,44 % to GNP in Total *Average of recent 5 years

The Progress of INDONESIAN Coffee

Indonesia the 3rd Biggest Coffee Producer in the WORLD

INDONESIAN COFFEE HISTORY

Arabica Coffee (Coffea Arabica)

Arabica coffee is a type of coffee plants that first entered

Indonesia in 1696

Arabica Coffee Plants damaged by flood.

New coffee Arabica seedlings arrived back to Indonesia in 1699.

The first Arabica coffee grown in the area around Jakarta and

West Java.

Arabica coffee Plantation then develop to other areas in

Indonesia.

For one century, Arabica coffee grown as farmer plantation

(small holders)

In the early 19th century , Arabica coffee plantation began to

develop large private estate in Central Java (Semarang & Kedu)

and in east java (Kediri & Malang) at the end 19th.

Arabica coffee grown in Indonesia for nearly 2 centuries

In 1876, arabica Coffee crops suffered a set back due to leaf rust

disease (Hemileia Vastatrix)

Arabica coffee crop was left only in the high area ( 1000 above

sea level)

Liberica Coffee (Coffea Liberica)

Arrived to Indonesia in 1875 to replace the Arabica Coffee

Plants that damaged due to leaf rust disease.

In fact, Liberica coffee also not resitant to leaf rust disease.

It was less preferred because too acidic.

Robusta Coffee (Coffea Canephora)

Entered to Indonesia in 1900

In fact, Robusta coffee have more advantages then arabica coffee

and liberica coffee, such as:

Relatively resistance to leaf rust disease.

More easily maintained

Require terms of robusta coffee grown are easier (400 – 800

meters from above sea level)

Production is much higher.

Expand throughout some region in Indonesia, until now.

ROBUSTA COFFEE DEVELOPMENT IN INDONESIA

Robusta coffee plants growing in Indonesia especially in Sumatera island covering Lampung, Bengkulu, South Sumatera; Java island covering Central Java and East Java; Bali and South Celebes.

Year Area (acres) Production (Ton)

Estate Farmer total Estate Farmer Total

1959 47,291 208,877 256,168 18,998 65,281 84,279

1962 45,126 242,475 287,601 12,559 99,121 111,680

1965 40,356 259,694 300,050 91,457 91,457 182,914

1968 38,259 328,378 366,637 13,824 143,341 157,165

2010 48,674 1,219,802 1,268,476 28,677 655,399 684,076

From the Dutch Colonial Era until now, Robusta Coffee become export commodities.

Years Volume (Ton) Value (000 US $)

1959 38,943 18,883

1962 58,530 12,599

1965 108,286 31,637

1968 82,087 42,970

1969 104,000 49,800

2010 447,494 846,542

1. COFFEE PLANTATION

Last 5 years(2007–2011*): don’ t show any significant

progress

Arabica Coffee : average increase at 6,0%

Robusta Coffee : average decrease at 1,0%

A. Planted Area

Year 2011* = 1.308.000 hektar

Arabica = 296.854 hektar (22.70%)

Robusta = 1.011.146 hektar (77.30%)

* prakiraan/estimate

Sumatra

Kalimantan

Jawa Irian Jaya

Sulawesi

Bali

Distribution of Coffee Growing Areas in Indonesia

Robusta Coffee

Arabica Coffee

Tahun

Year

Areal, ha

(Area, ha)

Produksi, ton

(Production, ton)

Arabica Robusta Total Arabica Robusta Total

2007 228.931 1.058.478 1.287.409 124.098 549.088 673.186

2008 239.476 1.063.417 1.302.893 129.660 553.278 682.159

2009 281.398 984.839 1.266.237 147.631 534.961 682.938

2010 283.343 985.133 1.268.476 148.487 534.961 683.448

2011* 296.854 1.011.146 1.308.000 155.383 553.617 709.000

Tabel 1. Land Areas and Indonesia Coffee Production

Source : Ministry of Agriculture, 2011

B. Coffee Production

Arabica

2007 = 124.098 Metric Ton

increase 25.0% or 6,25% annualy

2011* = 155.383 Metric Ton

Robusta

2007 = 549.088 Metric Ton

increase 0.8% or 0,2% annually

2011* = 553.617 ton

* estimate/target

Indonesia Coffee Production 2007 = 673.186 Metric Ton increase 5,3% or 1,3% annually

2011* = 709.000 Metric Ton

Coffee Production in year 2010 and 2011 can’t fulfill the

Target due to CLIMATE CHANGE (global warming)

Coffee Production in year 2010 and 2011 are only

530.000 Metric Ton

In some area Farmers have already change coffee plant

with cacao plant and palm tree.

C. Coffee Producers

Small Holder (Farmers)

Mature area : 890.000 hectare

Production per year : 650.000 tones (92,0%)

Average of product per hectare : 730 kilogram/ha

Government

Mature area : 18.000 hectare

Production per year : 15.000 tones ( 4,0%)

Average of product per hectare : 833 kilogram/ha

Private

Mature area : 20.000 hectare

Production per year : 15.000 tones ( 4,0%)

Average of product per hectare : 750 kilogram/ha

Coffee Farmers in Indonesia :

Approximately 1.9 Million head

The average area own by farmers only 0.8 Hectar/Head

Education level average Elementary (SD) thru High School

(SMA)

Plantation Systems are very traditional way

In Marketing, they depend on loan shark and collector

Government Estate :

1 . PTP Nusantara IX, Central Java with total production

appoximately 1.000 Metric Ton/year on Robusta

2. PTP Nusantara XII, East Jawa with total production 8,000

Metric Ton/year on Arabica and 2,000 Metric Ton/year on

Robusta.

Private Estate :

1. Approximately 10 companies

2. It’s getting lesser since 1998 when crisis economy in

1998

3. Cooperative within Farmers or Paople who live around

forest with Department of Forestry

2. COFFEE EXPORT

Tabel. Indonesia Coffee Export

Year

Volume Tones

Value 000 US$

2005

424,276

579,754

2006

307,883

497,615

2007

312,084

622,606

2008

421,784

923,542

2009

505.381

803.564

2010

443.766

777.949

2011*

265.409

700.937

* Until August 2011

In year 2010 Indonesia coffee export volume decreased

12.5%, and country devisa income from coffee commodity

decreased 3.2% compare to year 2009.

In year 2011 Indonesia coffee export volume by end of year

will be approximately only 400.000 Metric Ton, but country

devisan income from coffee commodities will hit record high

at USD.1 Million (increased by 30%) compare to year 2010.

Percentage of Indonesia Coffee export, still dominated by:

* Robusta Coffee : 80%

* Arabica Coffee : 15% and the rest is

* Solubel coffee at: 5%

German, USA and Japan are still main destination for

Indonesia Coffee

(Tones, US D)

Year Arabica Robusta Others Total

Volume Value Volume Value Volume Value Volume Value

2006

67,775

169,901

227,620

294,164

12,481

33,263

307,876

497,328

2007

50,952

141,926

247,852

425,332

13,279

55,343

312,083

622,601

2008

59,735

228,072

348,187

630,917

13,843

64,553

421,765

923,542

2009

62,854

172,909

434,430

608,304

8,098

22,351

505,382

803,564

2010

78,036

223,491

357,591

534,872

8,342

23,403

443,969

781,766

2011*

44,875

237,759

212,160

444,869

5,374

18,310

262,409

700,938

* Until August 2011

Tabel. Indonesia Coffee Export base on Coffee Type

No Country Volume Percentage

1 German 75,000 17.44

2 USA 68,000 15.81

3 Japan 51,000 11.86

4 Italy 26,000 6.05

5 Belgium 25,000 5.81

6 Algier 20,000 4.65

7 Philipine 15,000 3.49

8 Others 150,000 34.88

9 Total 430,000 100.00

Tabel. Average Indonesia Coffee Export at last 5 years

3. COFFEE CONSUMPTION

In year 2011 : 0,9 kg/capita/year

In year 2000 : 0,7 kg/capita/year

In year 1989 : 0,5 kg/capita/year

They have several factors which increase Coffee

Consumption in Indonesia:

Living Standard s are getting better

Coffee become favorite choice as refreshing drink which

will help to awake us..Its favor by young and old generation

,students, workers.

The ways to consume coffees easier and more varieties

The growth of finish product coffee industrial

Trend aand life style of people toward modern countries

The advance of Media Communication and Publication

4. Finish Products Coffee industrial

Downstream Industry of Coffee in Indonesia

2006 2007 2008 Number of Companies,in unit 77 77 79 Total Capacity in Ton 163,390 163,390 164,200 Real Production in Ton 133,459 137,215 141,450 (76 %) (78 %) (80 %) Export in Ton 12,006 14,096 15,506 Import in Ton 5,696 5,815 6,105 Labours (in force) 17,915 17,915 17,995 Sources: Industrial Dept. (2009)

COFFEE EXPANSION POLICY INDONESIA

1. Increasing Indonesia Coffee Production

A. Intensification Program

- For Arabica and Robusta Coffee

- Fertilizing:

o Robusta Coffee : Organic Fertilizer and NPK

o Arabica Coffee : Organic Fertilizer

- Replanting old trees with Better seed

- In force Good Agriculture Practices (GAP)

- Using friendly environment chemical to kill diseases

B. Extensification Program

- For Arabica Coffee

- Using lands above 1.000 m sea level

- Under shaded trees (under supervision department of

Forestry)

C. Goverment,Resaerch Insitute and Private Organization back up

- Government back up in funds

- Back up by ICCRI in readiness of BEST seeds

- Back up by Association and Private Institute

- Back up by Manufactures with their CSR (Corporate Social Responsibility)

D. Targeting for Increasing Productions :

In 15 years time, we will double the productions up to 1.5

Million Metric Ton

2. Coffee Protection

- Registration of Speciality Coffee at Geografis Indication

- Speciality that have already had Geografis Indication :

Gayo Coffee

Bali Kintamani Coffee

- In Process for Geografis Indication :

Flores Coffee

Toraja Coffee

- In Indentification of Characteristics of Indonesian

Speciality Coffees thru out the countries side like

Luwak Coffee

Preanger Coffee and etc

INDONESIAN SPECIALITY

COFFEE

INDONESIA SPECIALITY COFFEE

WHICH HAVE BEEN KNOWN IN THE WORLD

- Mandheling Coffee

TASTE : Full body, neutral, Good acidity

Export Potential : 40,000 ton

Main Market : USA, Eropa dan Jepang

- Gayo Coffee

Taste : Full body, Good acidity

Export Potential : 80,000 ton

Main Market : USA, Eropa, Jepang

- Java Coffee

Taste : Fine Acidity, exotic flavour

Export Potential : 12,000 ton

Main Market : Jepang, USA, Eropa

- Toraja Coffee

Taste : Good acidity, smooth, nice mellow

Export Potential : 4,000 ton

Main Market : Jepang, USA, Eropa

FUTURE POTENTIAL NEW SPECIALITY COFFEES

- WEST JAVA : Preanger Coffee

Location : Bandung Municipal (Pangalengan)

Potential Production : 1,200 ton

- Bali : Kintamani Coffee, Bali Coffee

Location : Buleleng and Tabanan Municipal

Potential Production : 4,000 ton

- Lampung : Robusta Spesialti Coffee

Location : West Lampung

Potential Production : 2.000 ton

- Eastern Nusa Tenggara : Banjawa Coffee

Location : Banjawa Municipal

Potential Production : 2,000 ton

- Papua : Jaya Wijaya Coffee

Location : Manokwari Municipal

Potential Production : 700 ton