Indonesia: Forward Thinking, Fast Growth

Yet again, Indonesia was chosen as the destination for AgriBusiness Global Trade Summit 2018 for good reason: the country and region’s unquestionably robust opportunities for growth in the crop protection sector.

Research firm Euromonitor has pegged Indonesia’s agrichemical industry compound annual growth rate target at 12.1% from 2016 to 2021, reaching $1.3 billion, driven by continued growth in its agricultural industry and government support of the ag sector.


Home to commodities like palm oil (world’s largest producer), rice, natural rubber, coffee, and exotic tropical spices, such as cinnamon, cloves, and nutmeg, the country is far and away Southeast Asia’s largest economy and crop protection market. Indonesia is now making headway on the transparency of its notoriously difficult pesticide registration process.

Indonesia: Forward Thinking, Fast Growth


“In the past it was hard to get information regarding the list of registered pesticides in Indonesia. Even with registration regulations, it was difficult to get information,” says Dr. Piyatida (Tung) Pukclai, Asia-Pacific Regional Business Development Director with Knoell. (Author’s note: Pukclai is a speaker at the Trade Summit in Jakarta this December.)

Now, “the authority provides much more information to the public than before. Announcements and regulations go up on the government’s website, which helps industries get information on updates and approvals,” Pukclai says.

In order to improve the performance of public services, especially agricultural licensing services, the country’s Center for Plant Variety Protection and Agricultural Licensing, along with the Directorate General/Technical Agency within the Ministry of Agriculture, “are committed to providing optimal services. This is very helpful for companies to comply with regulations and to drive foreign companies to invest more toward the market expansion in Indonesia,” Pukclai says. “With that being said, language is one of the challenging points as all regulations and updates are only available in Bahasa Indonesia.”

Snapshot: Success Story
One fast-growing Indonesian company is PT Inti Everspring, established in 1990 and a subsidiary of Salim Group. Everspring is active in areas ranging from technical active ingredient synthesizing and formulation to repacking and distribution. It also has MKD and Indotani as its product registration holder and distribution arms.

Indonesia: Forward Thinking, Fast Growth


The Jakarta-based company has also put serious muscle behind R&D and technology, upgrading its factory with modern equipment and automation backed up by state-of-the art synthetic and analytical laboratory capabilities. Everspring is also collaborating with domestic and international research centers, including LIPI (Indonesian National Science Center) and University of New South Wales (Sydney, Australia), says Gavin Gunawan, International Commercial Manager.

In 2019 Everspring is gearing up to expand capacity from 2,000 metric tons (MT) to 3,000 MT of its key carbamate insecticide active ingredients, including oxamyl, methomyl, propoxur, and fenobucarb, which it exports to markets such as North and South Africa, U.S., Central America, and Europe. It also formulates herbicides, insecticides, and fungicides in cooperation with Chinese and Indian producers.

Gunawan says, “Indonesia’s market has seen rapid growth in the past five years thanks to President Widodo’s food self-sufficiency program. Our market is currently at U.S. $800 million, doubled since 2013,” he tells AgriBusiness Global™ magazine.

Domestically, a ban on imports has sent Indonesia’s corn market soaring. “Limits on orange imports have also increased the appetite of local orange and other fruit growers to be back in business with better margins,” Gunawan says. “The trend of food safety will ultimately impact us in the middle hemisphere, as Northern Europe continues to struggle with climate,” he adds on the regulatory environment.

According to the Oxford Business Review, Indonesia’s infrastructure development projects rolling out in the years ahead will mean lower costs for production and logistics. Thus, the competitiveness of the nation’s farmers is also set to improve.

“The progress made by smallholder farmers is arguably the largest piece of the puzzle in terms of boosting production. Limited access to credit and inputs among smallholders means they will remain vulnerable to global downswings in commodity prices. Strengthening their capacity to mitigate market shifts is a priority for the Ministry of Agriculture. Achieving these goals is essential for the government as the agriculture sector continues to transform and develop,” the Oxford Business Review states.