Chinese investors fueling Indonesia's coconut boom

Domestic processing

Billy Widjaja, co-owner and chief commissioner of PT Indo Thai Coco Investama, said it is high time Indonesia took steps to boost domestic processing of coconuts for export. "We need to stop just exporting coconuts for processing industries overseas," he said.

PT Indo Thai Coco Investama is partnering with a coconut firm from Thailand to build a coconut processing plant in Lampung on the western Indonesian island of Sumatra.

The plant will produce coconut derivatives such as coconut peat, coconut fiber, charcoal, coconut milk and coconut water for export to Thailand, China, Japan and the United States.

"We are open to cooperation with any other party. We are ready to discuss with them about their specific needs," Widjaja said. He is also hopeful that the government will succeed in carrying out its sea toll road program for interisland connectivity so that his company can source coconuts from East Nusa Tenggara and other eastern Indonesian regions.

Irfan Abd Rahim, a native of Halmahera, said villagers in the eastern province were glad to watch, on national television and through YouTube channels, the maiden shipment to China in October of coconut products from their area. The coconut farmers are in a jubilant mood, he said from Halmahera in a telephone interview. He hopes there will be bigger ships for transporting coconuts from smaller islands to PT NICO's factory in North Halmahera.

Suaib Yunus, head of Belang-Belang village in South Halmahera Regency, said he agrees with Abd Rahim, and that there is a need for more sea armadas to transport coconuts to the processing facility in Tobelo. He mentioned insufficient land road systems in the area.

In Nusa Tenggara Province, the inaugural export-led shipment of whole coconuts from its Sikka Regency took place early this year. The commodity was shipped to Malaysia, India, Dubai and Türkiye.

Sonny Koda, deputy headmaster of a senior secondary school and a social activist in Sikka Regency in East Nusa Tenggara Province, which is located about 2,400 kilometers east of Jakarta, said he expects investors to come in and help process their coconuts into export-oriented derivatives.

He said that in the 350,000-population regency, small-scale farmers own and manage more than 90 percent of the area's coconut palm trees, as in other parts of the country.

Indeed, coconut palm tree owners in Sikka feel financially secure, although their earnings are small due to the stubbornly low prices of the commodity. However, it is still much better for them to have than not have coconut palm trees, Koda said.