The Indonesian Ministry of Industry (Kemenperin) has initiated the formation of cocoa and coconut institutions to ensure raw material availability, enhance competitiveness, and increase the Economic Value Added (EVA) from these sectors. Minister of Industry Agus Gumiwang Kartasasmita announced in Jakarta on Wednesday that President Joko Widodo has held a limited meeting regarding the establishment of a Cocoa and Coconut Fund Management Agency. The decision was made to delegate the management of these sectors to the Palm Oil Plantation Fund Management Agency (BPDPKS) by creating two new deputy positions: Deputy for Cocoa and Deputy for Coconut. "BPDPKS already has significant funds that can be utilized for the cocoa and coconut sectors, enabling immediate implementation," said Minister Agus. From 2015 to 2023, Indonesia's cocoa production decreased by 8.3% annually, leading to an increase in imports from 239,377 tons to 276,683 tons. The growth of the cocoa processing industry has not been matched by raw material availability, causing nine out of 20 companies to cease operations. Currently, the cocoa industry imports 62% of its raw materials. Indonesia, which was the third-largest cocoa bean producer until 2015, has now fallen to seventh place. However, in 2023, Indonesia remained the fourth-largest producer and exporter of processed cocoa products globally.
Despite this, the downstream sector for coconut utilization in Indonesia is underdeveloped, with processing industry utilization at only 55%. Indonesia has the potential to meet global demand, indicating substantial room for significant downstream development in the coconut sector. The formation of the cocoa and coconut institutions is expected to positively impact farmers and the industry by increasing productivity through land intensification and rejuvenation, improving processed products, and ensuring harvest absorption. For the industry, the benefits include increased EVA, higher export contributions, and diversification of high-value-added derivative products. By initiating these institutional frameworks, Kemenperin aims to stimulate significant growth and sustainability in the cocoa and coconut industries, enhancing Indonesia's position in the global market.
