Furniture makers see robust sales

The Jakarta Post ,  Jakarta   |  Mon, 09/15/2008 10:12 AM  |  Business

Despite a global economic slowdown and skyrocketing fuel prices, the furniture and handicraft business is riding a wave of optimism, targeting 26 percent growth in exports this year.

The Association of Furniture and Handicraft Industry (Asmindo) expects full-year exports to reach US$2.4 billion (around Rp 22 trillion), from $1.9 billion last year, said deputy director Basril Djabar.

As of the first half, it has already earned $1.2 billion.

To ensure the remaining $1.2 billion, the association is working on promotional campaigns and on intensifying efforts to look for new markets such as the Middle East and eastern Europe.

On average, the United States imports around 30 percent of Indonesia's total furniture and handicraft production, according to the National Agency for Export Development (Nafed), with Japan being the second largest importer, with a share of 11 percent.

The Netherlands and France are the third and fourth major buyers with 9 and 6 percent, respectively.

Basril said on Friday that frequent international furniture and handicraft exhibitions have helped keep Indonesia on the radar screen, with orders coming in.

"A lot of domestic and foreign players have made use of these events to promote products and make orders," he said, citing the example of the recent Indonesia International Furniture Fair that attracted foreign buyers.

In October, for instance, the association will hold an export exhibition to further promote global interest in domestic products and then later join similar events in China and some European countries.

The industry has seen steadily growing demand in the last three years, translated into an upward trend in export values. Asmindo data shows exports in 2005, 2006 and 2007 were valued at $1.79 billion, $1.81 billion and $1.96 billion, respectively.

The products include tables, chairs and filing cabinets made up from rattan, wood and bamboo.

"Thus far, sales to eastern European countries are less than 10 percent of total exports. But we are upbeat that they can be promising markets within a few years," he said, adding that the Middle East was just as attractive.

Grabbing customers from those regions, he said, could significantly boost the performance of Indonesian products in the international furniture market, led currently by China.

Last year, China earned $17 billion, out of the $80 billion global trade in wooden furniture.

Asmindo groups together over 2,000 members, most of them centralized in several regions, including Cirebon in West Java, and Jepara and Demak in Central Java.

Raw materials, especially rattan, are supplied by farmers living outside Java, such as in Sulawesi, Sumatra and Kalimantan.

Those regions are able to produce between 250,000 and 400,000 tons of rattan per year. (ewd)

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