Tuesday, 1 July 2014


Indonesia’s national rubber production is supposed to be number one in the world if productivity per hectare is increased. However, it is still a dream because until now, Indonesian rubber productivity is still far behind compared to Malaysia and Thailand. Size of rubber plantations in Indonesia reached 3.4 million hectares. The average production of national rubber, which is generally cultivated by new rubber farmers, only reached 1 ton per hectares. While, in Malaysia has reached 1.3 tons per hectare and in Thailand 1.9 tons per hectare.

With an area of 3.4 million hectares, Indonesian rubber production is estimated to reach only about 3 million tons (2013 target). While, Thailand has an area of about 2.4 million hectares, capable of producing natural rubber of more than 4 million tons. With that much production, the White Elephant country became world’s number-one producer of natural rubber. Indonesia still occupied the third position after Malaysia. If there is no attention to improvement of rubber productivity, Indonesia might be surpassed by Cambodia, Vietnam, Myanmar, and Laos, which also intensively improve rubber plantation area and productivity per hectare.

David Hapsari, Chairman of the Indonesian Rubber Association (Gapkindo), in Jakarta on Monday (June 9), admitted his concern over the lack of government’s attention to Indonesian rubber plantations and farmers. According to David, the implementation of replanting program of the government is still far from the expectation of farmers. David said that farmers have difficulty in accessing bank financing. Ultimately, farmers work together to get a certificates collateral to the banks.

Likewise, the interest of rubber farmers in replanting is low. Rubber selling price at IDR 7,000 is considered low for farmers, so it makes farmers reluctant to do replanting. Not much different, he said, there is lack of rubber seed and fertilizer assistance to farmers. From rubber companies, said David, they were given seeds at subsidized rates.

In response to this, the Director General of Plantation at the Ministry of Agriculture, Gamal Nasir, said that to boost rubber production. The government made replanting efforts for small-scale rubber plantations. IDR 20 billion fund from the state budget (APBN) has been spent by the government  to boost rubber production as a result of replanting. He said that the state budget is still relatively small to subsidize replanting of small-scale rubber plantations of 6,000 hectares.

He explained that replanting is rejuvenation of rubber plants that have reached the age of 25-30 years. Based on data from the Directorate General of Plantation, replanting costs of IDR 20 billion from the state budget has been going on since last 4 years. Gamal said that if it is boosted seriously, production target as a result of replanting is able to meet production value of 3 million tons annually.

Rubber is one of the leading export commodities of Indonesia. In 2013, the natural rubber sector accounted for 4.61% of the total Indonesian non oil & gas exports at USD 149.92 billion. The volume of rubber exports in 2013 recorded an increase of 260,000 tons or 10.7% from 2012 which reached 2.44 million tons. While, the export value decreased by 12.1% from USD7.86 billion in 2012.

Major export destination countries in 2013 were the United States with a total volume of 609,800 tons or 22.6 of total rubber exports, followed by China at 511,700 tons or 18.9%, and Japan 425,900 tons or 15.8% according to data from the Directorate General of Plantation, in 2013, Indonesia’s national rubber production reached 3.2 million tons. Of this amount, approximately 16% or 0.5 million tons were allocated for domestic needs, while 84% or 2.7 million tons for export demands valued at USD 6.91 billion. (E) 

Business News - June 11, 2014

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