Paper Edition | Page: 4
The soaring international price of soybean’s, which has been triggered by severe drought in the US, has triggered a significant increase in the domestic price of soybeans, especially at the retailer level. The retail price has exceeded Rp 8,000 (84 US cents) per kilogram, almost double the price of Rp 5,000 one or two months ago.
Complaints about the skyrocketing price of soybeans have come from tempeh and tofu producers across the nation. There have been reports of the collapse of small-scale tempeh and tofu businesses. The producers are facing a dilemma: on one side the price of soybeans is very high, but on the other side it is almost impossible to significantly increase the price of tempeh and tofu, which are both popular side dishes.
The adverse impact of raising the soybean price is the instability of tempeh and tofu production, since soybean is the main material of the foods. Although there are alternatives to soybean to produce tempeh and tofu, soybean remains the preferred choice by the majority of Indonesians.
Indonesia has relied on imported soybean for many years. As reported by the Central Statistics Agency (BPS), Indonesia imported 1 million tons of soybeans in 2010, while in 2011 the volume doubled to 2.08 million tons. Soybean imports cost Indonesia $2.24 billion last year.
The government has proposed the removal of the 5 percent import duty on soybeans to deal with supply problems, but the measure is likely to be effective only temporarily.
The proposed strategy does not affect the fundamental issue of stable and sustainable soybean production in Indonesia.
Elemental policies to improve domestic soybean production that leads to self-sufficiency should cover at least three policy measures, namely extension or expansion of cultivation areas, intensification by applying modern technologies and promotion and improvement of the diversification of legume ingredients of tempeh and tofu.
In regard to production capacity, despite its huge potential, Indonesia’s soybean production has not reached 1 million tons annually for more than a decade. The BPS revealed that in 2000, we produced 1.01 millions tons, but national soybean production later dropped to below 1 million tons.
In 2007, production reached only 590,000 tons, while in 2009 and 2010, the figure approached 1 million tons. Last year, however, production dropped considerably to 850,000 tons.
Soybeans are traditionally cultivated on moist land (sawah) and mainly grown in the first and second dry season. Since soybeans are grown on moist farmland, the crop faces tight competition from major food commodities such as rice and corn. Farmers usually grow soybeans in the dry season due to limited farmland and lack of irrigation to grow rice and other supplementary crops.
The expansion of soybean cultivation areas is likely to be adopted on moist land. Naturally, soybean can be cultivated under a mixed crop pattern on agro-forestry land and plantations. There is a higher possibility of applying a mixed crop system between soybean and main plantation plants such as rubber trees and oil palms.
Agencies such as the Agriculture Ministry could urge state and private plantations to adopt the mixed-crop system, especially in the first five years of establishing their plantations. This strategy may be implemented on agro-forestry land managed by either state-owned enterprises or local governments.
Dry land could also be used to extend soybean growing areas. Indonesia has almost 30 million hectares of dry land, and it is therefore a big opportunity to extend soybean cultivation areas managed by individual farmers.
The second policy of soybean farming intensification may work through several strategies, such as multiple crops of soybeans for prospective areas and the introduction of modern technologies, such as good quality seeds, better fertilizer, machinery and farming tools.
Through research and development, we could identify several high-quality local soybean seeds, such as Wilis, Argomulyo, Burangrang, Anjasmoro, Kaba, Tangamus, Sinabung, Penderman, Dentam-1, Dentam-2, Grobogan, Gepak Ijo, Gepak Kuning, SHR/Wil-60 and the newly released black soybean seed by Gadjah Mada University’s Malika research team.
Soybeans were planted on an area of 622,254 hectares last year, with the main producing provinces being East Java (252,815 ha), Central Java (81,988 ha), West Nusa Tenggara (75,045 ha), West Java (35,674 ha) and Aceh (35,370 ha).
Based on production level, the highest soybean production (ton per hectare) was in East Sumatra (1.57), East Sulawesi (1.57) and West Java (1.57), followed by Central Sulawesi (1.49) and East Java (1.45).
National soybean production remains low at 1.36 tons per hectare, but proper implementation of higher seed quality and better crop management would help boost production. Soybeans could be grown twice a year on particular farmland to improve production. Especially during the dry season, with the support of modern technologies and high efficiency of watering, intensification of soybean areas would be effective.
The third strategy of promoting and improving diversification of legumes for tempeh and tofu, if implemented, would reduce dependency on soybean. Due to its tropical weather, Indonesia is blessed with agricultural land that can produce a huge variety of local legumes that could basically replace soybean as tempeh and tofu ingredients. Among the prospective legumes are koro pedang and koro benguk.
To summarize, the government needs to introduce long-term and fundamental policies on soybean production, distribution and trade. Proper research and development involving government agencies, universities, the private sector and farmer groups would be necessary to develop a production system and the processing of soybean products in the future.
The writer is a lecturer at the Department of Socioeconomic Agriculture at the School of Agriculture and researcher at the Center for Economic and Public Policy Studies (CEPPS) at Gadjah Mada University, Yogyakarta.