Key recent agribusiness research projects in Indonesia that I have undertaken are listed below.

1. Profile of the Indonesian Horticultural Market, June 2005

2. Trends in fresh fruit imports and retail developments in Indonesia, October 2005 (annual)

3. Supply and Market potential in Eastern Indonesia for citrus, April 2007

4. Vegetable Supply Chain Issues in Indonesia with a focus on chili in South Sulawesi, June 2007

5. Report on the market in Indonesia for agrifood products, October 2006

6. Overview of trends and opportunities in the Indonesian agrifood market, November 2006

7. Feasibility study and business plan for a tropical custard apple orchard in Bogor Indonesia, 2007

8. Market demand study for South Sulawesi passion fruit, 2007

9. Mangosteen On farm and off farm study in NTB, 2007

10. Market demand and trends for Indonesian dried mango, 2007

11. Export strategy plan for Indonesian mango and mangosteen industries, 2008

12. Market potential for Australian goat meat in Indonesia, November 2008

13.  Seafood market supply chain in South East Sulawesi, June 2008

14. Market information reports for Dairy Australia, since July 2004

15. Indonesian market for Milk products, June 2009

16. Market demand for veterinary drugs for animal industries in Indonesia, October 2009
 
17. Investment opportunities and trends in the Indonesian horticulture sector, 2009

18. Supply and market chain of imported soybeans in Indonesia,  February 2010

19. Market demand and supply of dairy cattle to Indonesia, March 2010

a. Fruit Production
East Java is the second laregst producer of fruits in Indonesia (after West Java) with 2.7 million tonnes of
fruit; 16 percent of all fruit produced in Indonesia.
 Main fruits (as a percent of East Java production) - banana (30 percent), orange (23 percent) and
mango (22 percent)
 Main fruits (as a percent of Indonesian production) – mango (33 percent), papaya (24 percent)
and orange (23 percent)
 In Probolinggo regency, Mr Suli Artawi of Sumber Bumi (a family business) is a major player in
the mango industry in East Java. He heads a grower group (200 members) and grows, collects
and exports mangoes to Singapore. He has a 2 hectare mango farm which is GAP accredited
and another 5 hectares – 1,400 mango trees in total. The grower group members have about
60 hectares (12,000 trees) of mangoes which are all supplied to one of the 2 sorting sheds
owned by Sumber Bumi.

Sumber Bumi (grower / exporter)

Mr Suli Artawi is a major player in the mango industry in Probolinggo, East Java – he is a grower, head of
the grower group (200 members comprising 6 sub-groups), collector, exporter and industry expert. He is
often invited by Dinas Pertanian to be a guest speaker on development of mango exports. He was a
former “kepala desa” head of his village for 12 years.

Sumber Bumi is a family business. He has a 2 hectare mango farm which is GAP accredited and another 5
hectares – 1,400 mango trees in total. The grower group members have about 60 hectares (12,000
trees) of mangoes which are all supplied to one of the 2 sorting sheds owned by Sumber Bumi. The
season is from April to December.

Growers get fertilser, in-field training (group discussions on farm) and quick payment based on quality.

Quality grades are A (export – 500 grams), B (export – 450 grams) and C (domestic – markings). Good
growers can achieve 85% in export quality while fruit from older trees may be only 30% for export. Some
third class fruit is pureed or dried for crackers (home industry for local markets only). Main varieties are
harum manngis (export and domestic) and manalaggi (domestic).

There is no coolstorage. The fruit is picked (115 days after bud burst), sorted and packed for market
within 3 days. Export quality fruit is sent in 10 kg cartons (double thickness); 20 pieces individually
wraped per carton. C grade fruit is packed into 20 kg and 40 kg wooden boxes for market from Surabaya
to Jakarta (at Rp 25,000 per kg). The company supplies up to 15 tonnes a day of export quality mangoes
to Indomaret at a 15% premium price compared to export. About 5 tonnes per day are sent to Surabaya
for export to Singapore (Mr Edy – an Indonesian friend who lives in Singapore).

Suli would like to expand his exports to Australia.

Table 45. FRUIT EXPORTERS
No Name Company Address Phone Fax
Name
1 Martin M. PT. Sewu Jl.Telesonik Dalam Kadu Jaya (021) (021) Fruit
Widjaja Segar Curug No.18, Tangerang 590 2937 590 2935
Nusantara Jatake, Email:
[email protected]
d
2 Mustofa Salim PT.Masindo Jl. Nangka No.10 Tanjung (021) (021) Fruit
Mitra Barat Jagakarsa Jakarta 780 4304, 7883 5603
Mandiri Selatan.Email: 780 4351
[email protected],
[email protected]
3 Catherine PT. Agung Jl. Bandengan Utara No.1/5A (021) (021) Fruit
Joemono Mustika Jakarta Barat Email: 690 6403 690 7311
selaras [email protected]
4 Made Wiratha UD.Super Jl. Menu No.10 Singaraja Bali (0362) (0362) Fruit
Raja 92428 260 62
5 Ir. Atrixto PT. Trigatra Surabaya (031) (031) Fruit
Bintono Rajasa 871 3546 871 3545
6 Erfy Lawer PT. Agrosari Jl. Prof. M.Yamin No.23 GH (061) (061) Fruit
Sentra Prima Medan Sumatra Utara 455 1030 453 0439
Email :agrosari_sentraprima@
yahoo.co.id,[email protected]
m
7 Monica V. PT.Haraka Jl. Mojopahit No.50 Surabaya (031) 568 (031) 567 Fruit
Limba Jali Kitri Endah Email:[email protected] 3838,7325122 8051, 732 5131
8 Dewi Sutedjo PT.Sekar Jl. Raya Darmo No.139 (031) 567 1317 (031) Fruit
Alam Surabaya 5672318
Email:[email protected]
9 Helen PT. Glen Jakarta (021) 5367 (021) Fruit
Soegandhi Nevis Email. [email protected] 2699, 5365 5367 8298
Gunung 0006
Terong Mob. 0855 115
4150
10 Handoko PT. Pranata Margo Mulya I D 12 Surabaya (031) 744 3444 (031) Fruit
Singopranoto Bumi Permai Email: [email protected] 740 3835

4. SURVEY OF EXPORTERS

4.1 Business Type : Fresh Fruit Export Company

Company Name : PT Masindo Mitra Mandiri
Head Office Address : Jl. Nangka No. 10, Tanjung Barat, Jakarta Selatan 12530
Phone : (62-021) 7804304, 7804351
Fax : (62-021) 78835603
Contact Person : Musthofa Salim
Mobile : 0811 995 393
Title : President Director
Email : [email protected]; [email protected];

Vision – To be one of the most reliable suppliers of exotic fresh fruits and vegetables and to be
the most reliable exotic fresh fruits and vegetables preparation in Indonesia.

Goals – To provide quality products that meet buyer requirements; To serve customers with high
standard; To ensure the commitment of delivery services

Mission – Build up a good and accountable management team; Build up knowledgeable and
efficient work force; Build up researchers and development capability

Why did you decide to get into exporting fresh fruit? Our holding company was exporting
Indonesian food products and fresh vegetables into the Middle East. We were receiving inquiries
from our importers about Indonesian exotic fruits for Europe and the Middle East so we started a
new company in 2001 specializing on Indonesia’s exotic fruits.

What products did you start exporting and to which markets? We started with mangosteen and
rambutan by airfreight to Europe (Netherlands and France) with small volumes of salak. In
addition, with our connections in the Middle East we exported by airfreight the same products
plus mango to importers in the Middle East. Our fruits are packed in 2 kg cartons for Europe and
1.5 kg cartons for the Middle East. The Middle East prefers smaller size mangosteen (15 per kg)
compared to Europe (12 per kg). We have 5 main suppliers of mangosteen and 6 main suppliers
of rambutan from Bali, West Java and Sumatra (Lampung, Padang and Medan).

What are the main export challenges? Our biggest challenge and cost is logistics. The cost of
airfreight to Europe is about 75% of the C&F price of our fruits. But we also have difficulty to
get airfreight space when we need it. The other challenge has been the introduction of new
certification procedures by Europe in 2005. This impacted on our exports but we have now
overcome the problem (in the short term) by implementing a barcode certification system called
Global Solutions Indonesia (Barcode EAN). Global Solution First is the institution name that
issues The EAN certificate, the system that solve our problem is EAN 128 UCC. This system
enables us to trace every carton exported back to the farmer and date of picking. However, in the
long term we will need to ensure that our suppliers have EurepGAP accreditation but this is too
expensive for farmers. We will need FEDC or government assistance to work with our suppliers.

What are the opportunities for Indonesian fresh fruit exports? There are big opportunities for
Indonesia as it is a major producer of exotic fruits. The European market (with more than 300
million people) is a major importer of exotic fruits, including passionfruit. Indonesia needs to
improve the quality and continuity of supply of fruits so we have more fruits to export.

What are the costs along the supply chain? - Fruit (10%), local transport (5%), packaging (5%),
overheads (5%) and airfreight (75%). Average purchase price (in peak season) for mangosteen
fruit from West Java is about Rp6,500 per kg. Airfreight to EU is about US$4 per kg and to
Middle East at US$2 per kg.
How do your organize fruit supply? We deal with collectors in our main supply regions who co-
ordinate supplies from farmers. Sometimes we pay a deposit to the collectors to ensure that we
receive the fruit supply and to help to cover some of the farmers picking costs. The process is as
follows:
1. Receive order from importers for specific quantity of fruits
2. Contact airline to book and confirm space
3. Contact collectors to arrange supply of fruit – inform of quality required and date needed.
Collector receives fruit from many farmers and inspects for quality.
4. Collector sends fruit to Jakarta warehouse for packing (within 12 hours). There is no
coolstorage. All fruit is inspected on arrival and only fruit that meets quality requirements is
accepted (about 85% - 90%) while the remainder is sent back with the collector.
5. Fruit is exported within 24 hours of receiving the order
6. Collector is paid about 3-5 days after fruit is received

What export documentation do you provide?

1. Commercial invoice
2. Packing List
3. Airway bill
4. Phytosanitary certificate
5. Certificate of origin – Form A for EU and Form B for Middle East (from local Chamber of
Commerce on behalf of the Ministry of Trade)

4.2 Business Type : Fresh Fruit Export Company

Company Name : PT Agung Mustika Selaras
Head Office Address : Jl. Bandengan Utara no. 1/5A, Jakarta Barat 11240
Phone : (62-21) 6904140 / 6906403
Fax : (62-21) 6907311
Contact Person : Josep Joemono
Mobile : 0816 904 195
Title : President Director
Email : [email protected]

Mangosteen is a fruit which has thick woody peel of purpush black mangosteen encloses several
segments of exquisite juicy white flesh. With sweet slightly acid taste. Each segment has one
pale stone. Mangosteen is an original fruit of Indonesia, has a beautiful color, good taste and
popular as “The Finest Tropic Fruits”. The Mangosteen grows in the altitude of 80 meter above
sea level. The optimum temperature is 22° - 32° C, and the average rainfall is 1,500 – 2,500 mm
per year.

The peak season of mangosteen is in September – April. The production of mangosteen in year
2000 was 34,960 ton. The production centers of mangosteen are located in some area of
Indonesia such as: North Sumatera, West Sumatera, Bangka Belitung Island, West Java, Central
Java, East Java, Bali, etc. These areas might become a good chance for Indonesia to develop as
export commodity to overseas countries because of the very unique taste, the ability to grow and
well produce.
PT Agung Mustika Selaras was established in 1985. At the beginning we supplied fruits such as
orange, apple, mango, mangosteen, banana for Indonesian local customer then started exporting
the fruits in 1986 to many world wide countries such as Taiwan, Singapore. Moreover by our
expert and experience in mangosteen fruit handling and delivery, we have been focusly exporting
mangosteen. Currently with total 100 employes, supported by many resource of mangosteen
plantation centre/supplier, good transportation, 12 cold storage in our warehouse (capacity for 40
x 40 foot containers) , well arranged sorting, handling and packaging make PT. Agung Mustika
Selaras be the leader in mangosteen processing and exporter. Our export destination countries are
Taiwan, Singapore, RRC, Hongkong. Total Export PT. Agung Mustika Selaras for mangosteen
product in 1999 year is 1,624.10 ton; in 2000 year is 1,310 ton; in 2001 year is 704 ton. The
company exports on average 6 containers (20 tons each) per week for 8 months.

Vision is to disseminate Indonesia Mangosteen to be familiar in foreign countries as the good

quality product with luscious taste.

The main issues are setting in place procedures to gain market access to new markets – need for
VHT equipment.

Mr Joemono has established long term relationships with his more than 100 suppliers (collectors
and large growers) for over 20 years. Many of his suppliers will telephone him during blossom to
ask for an advance payment for harvest. Money advance will be sent based on forecast volumes.
When the fruit is ready for harvest it will be sent to Jakarta for packing within 12 hours of
picking. Price is negotiated later after sorting the fruit quality and marker prices. The poor
quality fruit is sold to Pasar Induk.

Mr Joemono is interested to develop a business in Lombok with mangosteen sent by his own
refrigerated trucks to Jakarta for final quality inspection and packing for export.

The company has been accredited with the Indonesian national standard: SNI 0132111992.

4.3 Business Type : Fresh Fruit Exporter

Company Name : PT Glen Nevis Gunung Terong
Head Office Address : Jakarta
Phone : 6221- 5367 2699
Fax : 6221- 5365 0006
Contact Person : Ms. Helen Sugandhi
Mob. : 0855 115 4150
Email : [email protected]

 No mangosteen exported yet

 The products of mangosteen are taken from local farmers
 The company is now developing a production land for mangosteen products in Banyuwangi East
Java
 So far international buyers come to buy from the land
 Taiwanese bought 5 – 6 containers per harvest time, with volume of 12 tones for each container
 There are 3 grade of products: A and B will go for export, C for domestic market
 China market prefers bigger size, while Middle East market prefers smaller size.
 Europe market is still considered difficult due to the regulations where the exporting company is
required to have a GAPP license and PT Glen is currently processing its license so they can export to
Europe.

4.4 Business Type : Fresh Fruit Exporter

Company Name : SS Fresh Fruit
Head Office Address : Cirebon
Phone : 62231- 8491614
Fax : 62231- 8491614
Contact Person : Mr. Sahril Sidik

 Only Mango var. Gedong Gincu

 Export to Singapore (main market), USA (white house??) and Pakistan (the buyer came directly and
bought from his land)
 The products from his own, local government and state-owned company’s lands where he rent
them fr a long period of time. Total about 400 hectares
 Export to Singapore about 1 – 2 tones per 2 days during harvest time (May to January)
 No coldstorage needed as the products are packed directly to cartoon and delivered by freight
forwarders. The company uses Cardig to send the products overseas, including all export
documentations.
 There are 3 grades of products : A and B go for export and domestic high-level market (SOGO, Al
Fresh and Total fruit markets), while C grade goes to local central market (pasar Induk)
 The price is almost similar for domestic high-level market and for export which is around Rp.18,000
per kilogram. The price for domestic is minimum because low transportation and packaging costs
(only using plastic cardboard which can be used many times) while for export market the basic price
is lower but high packaging and transportation costs.

4.5 Business Type : Fresh Fruit Exporter

Company name: UD. Super Raja
Head office address : Singaraja, Bali
Phone : +62-362-924 28; +62-362-250 04
Fax : +62-362-260 62
Contact persons : Pak Made Wiratha Hok
Export
In 2006 an estimated of 60 tons were exported from Pak Hok in China from the 2 main collectors (50%).
Exports to Taiwan (1990-2002) have stopped since the regulations have increased. The mangosteen
import has been restricted because of the ants and eggs that are under the mangosteen leave. Then, the
export to HK/China have started and since then continued. No strict regulations have stopped the entry
of mangosteen although documentation has made the process more difficult. The price was lower at the
beginning but has since 2002 increased to follow the market.

2005-2006 total exports were about 5 tons/ day at the beginning of the season and reached 25 tons/day
during panen raya, this over 5 months.

Locations:
 Jawa: good quality, high volume (ex: Tasik)
  Sumatra: good quality and high volume (ex: Kelinci), sometimes the fruits are picked too
early making them unsuitable for export
 Bali: Bigger quantity from Pak Hok’s export
 Lombok: low quality (disease, broken and watery) and small quantity, highest BS (50-
70%), transportation problems (bad road system), poor harvest and handling techniques.
The pasar local and antara pulau is stronger (Flores, Sumbawa, NTT)

Transport:
 Cold trucks: 10+ tons (2-3 days to fill the whole truck in Lombok)
 Ordinary trucks: 4.5 tons
 Transport is mainly by land and sea. In Indonesia, flights are used only during ceremony
periods when Chinese are willing to pay more for the Queen fruit (mangosteen), but
usually cargo ships are used as flights are too expensive and no charters, especially for
foods and/or fresh fruit, are available. In Thailand, for instant, the gvt is supporting the
export of fresh fruit by offering charters at a very affordable price. The mangosteens can
then be sold at a very competitive price from Thailand (around 0.5$/kg)
 Bali – Surabaya : 1 day
 Surabaya – HK: 5-6 days
 40 feet container can contain 2058 export size packing boxes (8kg/box)
 Cost for container (40 feet; Jkt-HK): 1000$ and around 20millionRp including all costs
(ex: paper work, employees, gvt, etc)
 It is too expensive to ship from Lombok or Bali therefore the closest harbor to be used is
Surabaya
 Around 100 anak buah are located a little over Indonesia and have for mandate to update the
exporter in term of growth and weather conditions in order to make purchase forecast.
Sometimes those can be bribed by the collectors

Quality
Based on the following important factors:
 Inclination of the land
 Not too much rain
 The maintenance of the tree (cut branches to allow the fruits to grow bigger for premium
export quality)
 Collecting/handling techniques
 Quality can be assessed from the amount of BS. The exporter will sent his sorters (unless
he trusts the collector to do the sorting him/herself) at the collector site and fruits will be
sorted according with export quality requirements. This selection, will be packed and sent
to the harbor, then double checked (sample of an average of 10% of the boxes) then if
fine will be sent to the exporter. Once at the exporter site, it will once again be checked
for quality. In the case where the review fails, the fruits will be unpacked and sorted
again, before being packed once more and shipped abroad. In this case, the tukang sortir
will most probably be fired while in the opposite case, a good commission will be
distributed to the tukang. In Lombok, +/-30% of the times, fruits need to be sorted again
at the exporter site.
  Price is very difficult to estimate as it is set depending on the market. Usually the price
comes from the importer (buyer) who will offer a price and if it is acceptable (therefore
good compared with the pasar local), then the exporter will determine the price at which
he will buy the fruits. Price can vary as much as 6.000 – 15.000Rp/kg for super quality
mangosteen.
 Demand is high and so far can never be covered because quantity is not sufficient.
 The main problems identified:
1. Book keeping
2. No fertilizer or wrong utilization
3. Land and field not appropriate
4. Bad handling techniques and poor technology
5. Weak/lazy farming techniques (no maintenance)
6. Weather conditions often inappropriate (to rainy)

4.5 Business Type : Processed Fruit Exporter

Company name: PT Agrosari Sentraprima
Head office address : Indonesia (Medan)
Phone : +62-61-455-1030
Fax : .:+62-61-453 0439
Contact persons : M. Erfi Lawer [email protected]

25 years in the export sector and 10 years in the process.

They use to export fresh fruits but because the cash flow requirement is so high (4 times higher than the
value of the shipment) and the delay for export short/negociation power low, they have decided to
concentrate on semi-processed produce. Meaning that the buyer is not selling to the end user but
processed once more. Their main products are canned fruits and processed juice and/or puree. They
also have additional/parallel activities such as mangosteen dry skin.

Export:
While a dry container cost from Medan to China approximately 800UDS a freezer container costs
1350USD. In order to ship the puree in dry container, they should use septic bags, which are not
available in Indonesia and should be imported from Holland or China, therefore adding to the overall
costs.
While it is possible to enter Taiwan and other countries of Europe with mangosteen produce, some new
requirements are difficult to achieve such as measuring the anti-oxidant in the puree.

Process:
1. The fruit used is second quality (BS and/or do not match export quality requirements)
2. The fruit is peeled manually and separated for puree process and dry skin process
3. The meat from the fruit will be separated from the seeds in the pulp finisher machine
4. The puree will be pasteurized in the tabular heat exchanger
5. The puree will be cooled in the same machine during a second processing
6. The puree will be packed in 5 galon boxes with polarized foil paper
7. Kept in cold storage (-18C) for as long as 2 years
To make juice, it is the same process but longer in the pulp finisher and water and sugar should be
added.
To dry the skin, an oven is used. It can also be sun dried (4 days), but shouldn’t be exposed to any rain at
all, or fungus will damage it.

Value chain:
The skin is bought by an exporter in Jakarta/Bekasi (Mr. John) which sells to India or China which will
process (extract the anti-oxidant) into powder than resell to America for healthy vitamin. The dried skin
can be sold for 1000Rp/kg, with a very small profit margin
The mangosteen puree (semi-processed) is sold to Taiwan and sometimes to China, which will then sell
as it is to Japan or America, where juice or other finished goods will be prepared. The price for
mangosteen is in average 2000Rp/kg at beginning and end of season and between 2500-4000Rp/kg in
panen raya. For the fruit bought outside Medan, the price is in average 500Rp/kg more expensive. Only
20% of the fruit will become puree. The selling price is not known clearly at this stage but it seems like
the profit can fluctuate a lot depending on the amount of mangosteen available, the weather and the
handling process during peeling (if the puree is rosé or reddish it cannot be sold. Should be beige).

Sumatra specifications:
The island being long the mangosteen season can last as long as 6 months.
The mangosteen can be shipped from Medan directly to China or other ports. If the fruits go through
Malaysia, the mangosteens loose their Indonesian identity. This can be dangerous for tracking and local
exporter however the mangosteen from Malaysia being accepted in Taiwan, some exporters will arrange
to join freight in order to sell to Taiwan. The main port is Belawan (go to HK and to KL).
The rainy season can be a big problem for the local farmers. When rain comes they often have to hire
tukang for fruit picking, which will keep as much as 50% of the revenues.