Upstream-Downstream Challenges of Spice Commodities
By
MUKHAMAD KURNIAWAN and ALOYSIUS B KURNIAWAN
·5 minutes read
Pepper, nutmeg, clove, cinnamon and vanilla are major Indonesian spices. Each year, the country makes millions of US dollars from exporting these spices. However, Indonesia’s spice exports have not been developed optimally, as seen in the basic problems farmers in spice-producing regions face.
In 2015, the combined export value of pepper, nutmeg, clove, cinnamon and vanilla stood at US$824.37 million. The demand for spices continues to grow. Related associations and institutions recorded an increase in demand over the last few decades, occurring alongside expanding culinary trends and dining culture across the globe.
This phenomenon is evident in the consumption of pepper. The International Pepper Community (IPC) records that the average pepper consumption per capita in 1975-1995 grew in Denmark, Germany, Belgium, France and the US. In Denmark, per capita consumption increased significantly from 102 grams in 1975 to 128 grams in 1980, and to 194 grams in 1990-1995.
The Central Statistics Agency’s national socioeconomic survey also reflects the growing trend. Indonesia’s pepper consumption in 2000-2014 grew by an average of 1.29 percent per year. Meanwhile, nutmeg consumption increased by 9.87 percent per year in 2002-2015.
The development of several spice commodities is considered promising. Ginger, vanilla, cinnamon and nutmeg – according to data from the Trade Ministry – are listed in the “star” quadrant of the Indonesian export product map. This means that global import trends and Indonesian exports are both positive.
Fighting alone
The journey of the Kompas Spice Path Expedition team on March 7-June 6, 2017 found relatively similar problems at the production centers it visited. The team met with farmers and visited pepper farms in South Ogan Komering Ulu, South Sulawesi; West Bangka, Bangka Belitung Islands; and East Lampung, Lampung; as well as nutmeg plantations in the Banda Islands, Maluku; in Ternate, Makian and Jailolo, North Maluku; and Siau Island, North Sulawesi.
At the white pepper production centers ofthe Bangka Belitung Islands, some farmers felt they struggled alone against pest infestations, weather uncertainties and limited post-harvest facilities. For example, the 2015 harvest was not optimum because the plantations suffered a dry season of more than seven months; the ideal dry season must not last longer than three months. A lack of irrigation channels forced the farmers to soak the pepper in ponds or in ditches, risking contaminating the harvest.
Nutmeg farmers in Bangka Belitung should be pleased because their products have earned the geographical indication certificate (SIG) and are known on the global market under the trade name Muntok white pepper. The selling price of their nutmeg is also higher than other varieties. However, they receive minimal support in their efforts to maintain quality and production.
“We lack support in fertilizers, seeds and production facilities,” said Gunawan, the secretary general of the Indonesian Pepper Farmers Association and a Bangka pepper farmer.
The upstream sector –or cultivation– remains at a minimum. Prime seeds, fertilizers, plantation maintenance and pest control are key factors for a successful pepper production. However, not a few farmers become confused when identifying pests and diseases and dealing with them. Pests and diseases sometimes go out of control as a result of misidentification and the wrong treatment.
Meanwhile, several nutmeg farmers on Makian Island, South Halmahera, find it difficult to consult on their problems in the field. They complain about the rarity of visits from agriculture advisers, of meetings at the village hall and other supporting activities related to crop processing to increase the selling price.
On the other hand, nutmeg farmers on Siau Island, North Sulawesi, boycotted the government’s fertilizer subsidy because it was not in line with the farmers’ mission to increase nutmeg quality through organic farming. Socialization of the assistance was minimal, while information about the fertilizers’ content and benefits were not provided to the end-users. Bags of unused fertilizers are piled up at the plantations or are being used to build embankments.
Socioeconomics researcher Rini Ekwasita at the Indonesian Spice and Medicinal Research Institute (Balittro) said some farmers position spices as crops cultivated as a source of additional income. Spice harvests are seasonal, so farmers try to find other sources of income.
Other farmers feel satisfied with their income from spice crops. They feel that they do not need to fertilize the crops, maintain the plantations or spray them with foliar nutrients to increase yield and quality. Another factor that negatively impacts farmers’ motivation is that good-quality spices and low-quality spices sell for the same price.
Downstream
Post-harvest processing is also not optimal. Nutmeg farmers on some islands in Maluku, the North Maluku Islands and in North Sulawesi dry nutmeg fruits on tarpaulin under the sun. This could cause fungal growth. Yet, the farmers have no choice, because of their limited capital and lands.
In fact, the presence of aflatoxins –carcinogenic toxins produced by certain fungi– is one of the common complaints among foreign buyers. In some cases, Indonesian nutmeg have been rejected by foreign markets because of the discovery of aflatoxins.
It is hard to disassociate the nutmeg trade from fraudulent practices undertaken for profit. A similar situation also exists in the pepper trade.
Trademarked pepper varieties on the international market – Muntok white pepper and Lampung black pepper –have become a target of falsification because of their high prices. Unfortunately, as with nutmeg, the pepper farmers who try to increase the quality of their products through better screening, drying and storage receive no significant incentives.