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Surging soybean price hurts entire supply chains
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Hakim removes floating soybeans during the boiling process. These are of poor quality and will not be used to make tempeh. JP/ Anggara Mahendra (JP/Anggara Mahendra)
T
he surging soybean price is taking a toll on supply chains in Indonesia’s food and beverage industry amid the country’s heavy reliance on imported soybeans.
The price of imported soybean hit US$16.75 per bushel on Thursday, up 17.6 percent from last year, and just above the last peak, which was in May 2021, Business Insider data show.
Tofu and tempeh producers have been hurt the most by the hike. The government estimates that 90 percent of the country’s soybean goes into those two staples of national cuisine.
Imported soybean is currently sold at Rp 13,300 (92 US cents) per kilogram in the domestic market, 15.65 percent higher than a year earlier, Trade Ministry data show. Before the pandemic, producers were used to buying the ingredient at around Rp 8,000 per kg.
Many tofu and tempeh producers in Java halted production last week amid high costs and low margins, causing a scarcity in the market and affecting many businesses.
Read also: Tofu, tempeh producers go on strike over high soybean prices
The global soybean price hike adds to imported inflation in Indonesia. Indonesia sources some 90 percent of the commodity from producers in the United States, who have increased prices in response to rising production costs and high demand from China.
