Indonesia is the world's third-largest coffee producer and exporter, after Brazil and Vietnam. National coffee output has grown over the past decades, albeit not in a linear fashion as harvests fluctuate strongly from one year to another depending on the weather. With per-capita coffee consumption on the rise both in Indonesia and the wider region, there is obvious room for further growth, but there is also an obvious need for investment. The capital required to take Indonesia's coffee industry to the next level presents appealing prospects for investors, while the country's burgeoning coffee culture also brings opportunities for foreign exporters.

    Indonesia's tropical climate produces almost ideal conditions for planting coffee. Today, most Indonesian coffee comes from Sumatra, but Sulawesi and Kalimantan, the Lesser Sunda Islands of Bali, Sumbawa and Flores as well as the country's easternmost region of Papua all contribute to national output. Robusta coffee makes up more than three quarters of Indonesia's produce; the remainder is of the milder Arabica type. The numerous coffee-growing regions in the country produce beans of distinct flavors and properties, and a number of highland Arabica coffees from Indonesia are recognized by aficionados the world over.

    Indonesian coffee exports rose from 336,840 tonnes (or 5,614,000 60-KG bags) in crop year 2000/2001 to 656,400 tonnes (10,940,000 bags) in 2012/2013, according to data collated by the International Coffee Organization. Total production over the same period increased from 419,220 tonnes to 763,800 tonnes. At present, the principal destinations for Indonesian coffee are the US, Japan and Western Europe (particularly Germany), but Indonesia is well placed to capitalize on the fast-rising demand in the ASEAN region and in China. 

    Indonesian per-capita consumption of around 1.2 kg in 2012 pales against more than 4 kg in the US, around 7 kg in the world's number one coffee producer Brazil and more than 10 kg in various European countries. But with Indonesian per-capita consumption having already doubled in just a few years, domestic demand looks to be on a fast growth trend. This puts the world's fourth-most populous country on course to become a leading coffee market. Local demand is driven by the lifestyle changes that accompany urbanization and economic development. Caffeine consumption tends to increase when a larger part of the labor force works in an office environment.

(Adapted from www.gbgindonesia.com)

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(KISI-KISI SBMPTN 2020)