Mind, body, spirit of tea industry

Mohamad Rayan ,  Jakarta   |  Fri, 03/28/2008 1:38 AM  |  Opinion

The prices of coffee, cacao, rubber and palm oil in international markets are booming. Consequently, farmers and big plantations throughout the provinces of Aceh, North Sumatra, South Sumatra, Lampung, South Sulawesi and East Kalimantan are experiencing a mini boom.

But amid these booms, the government and private sector are apparently overlooking another commodity: tea.

The Indonesian tea industry is facing many problems.

The first is low productivity.

"Currently the productivity is 1,900-2,000 kilograms of dry tea per hectare per year, compared with the world average of major tea producers such as Kenya, Sri Lanka, China and India, which is 3,000 kilograms of dry tea per hectare per year," chairman of the Indonesian Tea Association, Insyaf Malik, said in January.

The second problem is related to quality. The quality of Indonesian tea is below the ISO 3720 international standard.

Third is the slowness of tea replanting.

And fourth, tea processing machinery is failing to keep up with the dynamic and fast-changing market demand.

These latter factors have caused the drop in Indonesian tea productivity, resulting in a low market price. Indonesian tea was fetching around US$1.40 per kilogram in 2007, compared with $2 for Kenyan tea and $1.85 for Sri Lankan tea. The current world price is $1.93.

These industry weaknesses were also behind the decline in Indonesian tea exports. In 1993, 123,000 tonnes were exported. This fell to 88,175 tonnes in 2003, rose to 102,292 tonnes in 2005, before falling again to 90,000 tonnes in 2006, which represented 6.5 percent of the global market.

The export destinations of Indonesian tea are the Middle East, England, Russia, Pakistan, Malaysia and several countries in Europe.

Just to maintain its current world market share and ranking, the Indonesia tea industry, which has more than 142,800 hectares of plantations, needs to develop a special and integrated approach and processes for input factors, rehabilitation and replanting.

Any approach must be implemented with a view to maximizing estate productivity or it will be substandard management.

Smallholders account for 49 percent of the plantations; 29 percent of plantations are state-owned and the rest are private estates. However, state plantations produce 40 percent of the national output, while smallholders produce only 23 percent.

Tea producers need to anticipate international consumers' demands particularly in regard to health, ethical and environmental issues. Consumers in Europe, North America and Australasia, especially, are very demanding.

Marketing based on the theme of mind, body and spirit would help increase demand for Indonesian tea and could help increase Indonesian tea exports. To achieve this, our tea should be labeled as ethical, pro-health and pro-environment.

Ethical production means workers' conditions are good, there is no child labor and estate employment conditions are of a good standard. The pro-health aspect focuses on the therapeutic quality of the tea. Pro-environment assures the buyer the plantation is protecting the environment by using its trees to prevent landslides and floods, as the effects of climate change cause extreme weather.

And to extend its current market share, the Indonesian tea industry needs to lobby the central government to include tea as a priority commodity along with palm oil, rubber, cacao and coffee.

The government should help the industry in promoting Indonesian tea around the world, given global consumption increased from 2.5 million tonnes in 1990 to 3.2 million tonnes in 2007. Ideally the government should also promote tea consumption within Indonesia, so consumption could increase from its current level of 300 grams per person per year to something like the consumption in Turkey: 3 kilograms per person per year.

The writer is community relations manager of Borneo Tropical Rainforest Foundation. The views expressed here are his own.

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