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Indonesia Agribusiness Report Q2 2014

Indonesia Agribusiness Market: New market information published


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2014-04-03 05:26:04 - Indonesia Agribusiness Report Q2 2014 - a new market research report on companiesandmarkets.com

Overall, we hold an optimistic outlook on Indonesia´s agriculture sector and see significant growth opportunities in sub-sectors such as livestock, palm oil and cocoa. While we believe the government´s goal to reach self-sufficiency in rice by 2015 is attainable, we are less confident about other commodities such as sugar and corn. We also highlight that the country´s aim to become the second largest coffee producer in the world by 2015 is unrealistic. Much of our scepticism relates to the lack of proper infrastructure and the existence of a large number of low-technology, small-scale farmers. We believe the shift from raw commodity exports to refined exports (especially for palm oil and cocoa) will warrant more public and private investment in order

 

 

for the raw inputs industry to keep pace with downstream industries.

Investments by Wilmar, Golden Agri Resources and Barry Callebaut are clear signs of the growing interest in these sectors.

Key Forecasts

- Rice production growth to 2017/18: 14.5% to 42.0mn tonnes. We believe Indonesia will attain its goal of being self-sufficient in rice in the coming years, as the country is multiplying the initiatives to boost production. Growing use of high-yielding paddy varieties and agriculture intensification will help output record higher growth rate than in the past.

- Sugar consumption growth to 2018: 32.9%% to 6.8mn tonnes. Consumption growth will continue to outstrip production growth, driven by rising incomes, greater urbanisation, population growth and the growing demand from the food and beverage industry.

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Mike King
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