Light Barriers to Imports

OTA estimates total organic market consumer sales of Indonesia at about $13.6 million USD per year.

  • The total market size for organic packaged food and beverages in Indonesia in 2015 is US$10.9mn, making it the 42nd largest market in the world by value.
  • Per capita spending on organic packaged food and beverages in Indonesia is slightly higher than US$0.0, which ranks as the 49th largest spending per capita in the world. This low per capita spending is explained by the country’s high population.
  • The largest company by sales in organic packaged foods and beverages is Kampung Kearifan, which maintains 30.5% of total sales, followed by UD Padi and Bumi Ganesa PT.
  • Organic packaged food and beverages in Indonesia will see fast year-on-year growth of close to 7% in 2015. This is slower than the rest of the Asia Pacific region, though by 2020 Indonesia’s year-on-year growth will surpass that of the rest of the Asia Pacific region.
  • Indonesia maintains a market size for organic packaged food and beverages of US$10.9mn in 2015, which is less than 1% of global category sales.
  • Within the Asia Pacific region, Indonesia trails the large markets of China and Japan significantly.
  • Despite the comparatively small market size, Indonesia will experience rapid forecast growth of sales of organic packaged food and beverages, at 9.4% from 2015–2020.

QUALITATIVE ANALYSIS

Quick Facts

  • The total market size for organic packaged food and beverages in Indonesia in 2015 is US$10.9mn, making it the 42nd largest market in the world by value.
  • Local organic food and beverage producers hold the majority of the market.  
  • Before packaged food products can be labeled and sold as organic, they must be approved and meet the guidelines set by the National Standardization Agency for production, processing, labeling, and marketing of organic food products. 

Market Trends

Competitive Landscape

  • As of 2014, no significant multinational players or private-label organic beverages were present in Indonesia. 
  • Local organic players have consolidated, offering a greater range of food and beverage products, but most still have regionally limited distribution. 
  • Local company Kampung Kearifan Indonesia PT leads the organic food and beverage market. Additional notable local players include UD Padi, Javarabica PT, Bumi Ganesa PT, and Mahkotadewa Indonesia PT. 

Prospects and Growth Opportunity

  • In urban areas there is a growing middle class that is demanding more products with quality and food safety in mind. This will offer strong support for the growth of organic products. 
  • The growth and popularity of organic packaged food and beverages is bolstered by the continuing efforts of the government and various NGOs to encourage organic farming and higher consumption of organic products in Indonesia.
  • Economic improvements and increasing price competition between local and imported products could make organic packaged food products more affordable for many Indonesians and create greater demand for organic products. 

General Health & Wellness Trends

General Economic & Demographic Landscape

Economy: 

  • Indonesia's economy is in a state of transition, with future growth likely to depend less on the primary sector and consumer spending, and more on processing and manufacturing industries and services. 
  • The IMF predicts that Indonesia will be the world’s fifth largest economy by 2030.
  • In 2014, the Indonesian Government imposed significant fuel price hikes that greatly impacted the purchasing power of consumers and increased the prices of various consumer goods. 
  • Real GDP has grown rapidly in recent years due to the government’s highly publicized public spending program that was implemented in 2015 to shore up the economy and improve public infrastructure. 

Population demographics: 

  • The population of Indonesia was nearly 250 million in 2014, an increase of 98.7 million since 1980. 
  • Indonesia has a relatively young population; in 2014 only 5.9% of the population was 65+ years old. 
  • Brain drain is a problem, as a large portion of Indonesia’s highly skilled workforce migrates to countries such as Singapore or Australia in search of better career prospects.

Income & expenditure: 

  • In recent years, unemployment has decreased as more people, primarily youth, have joined the informal work force, despite lower wages and less job security. The salary of most of these workers fell short of the minimum wage in 2015. 
  • Purchasing power is concentrated in the western islands of Java, Sumatra, and Bali where the population is more urbanized and densely concentrated.

QUANTITATIVE ANALYSIS

Organic packaged food & beverage data

 

Data type

2012

2013

2014

2015

2016

2017

2018

CAGR
(12-15)

CAGR
(15-18)

                   

Health & wellness products consumption

5,754.5

6,396.0

7,348.3

8,109.3

8,579.2

9,065.3

9,568.1

12.1%

5.7%

Organic packaged food and beverages consumption

7.6

8.5

9.6

10.9

11.7

12.7

13.9

12.8%

8.4%

Organic packaged food consumption

7.0

7.8

8.8

9.8

10.6

11.5

12.6

11.9%

8.7%

Organic beverages consumption

0.6

0.7

0.9

1.0

1.1

1.2

1.3

18.6%

9.1%

Organic packaged food and beverages consumption as a % of total health & wellness products consumption

0.1%

0.1%

0.1%

0.1%

0.1%

0.1%

0.1%

-

-

Economic & demographic data

Data type

2012

2013

2014

2015

2016

2017

2018

               

Total population

248.0

251.3

254.5

257.6

260.6

263.5

266.4

% Middle and upper class of total population

28.6%

28.4%

27.9%

27.8%

27.6%

27.5%

27.5%

% Population aged 65+

5.0%

5.0%

5.1%

5.2%

5.3%

5.4%

5.5%

% Population aged 0-14

28.5%

28.2%

28.0%

27.7%

27.4%

27.1%

26.8%

% Population with higher education degrees

8.0%

8.1%

8.1%

8.1%

8.2%

8.2%

8.2%

Average number of children per household

1.3

1.3

1.3

1.3

1.3

1.3

1.3

GDP per capita

2,593.9

2,830.7

3,094.0

3,339.8

3,465.1

3,605.7

3,756.1

Consumer expenditure per capita (US$)

1,467.1

1,626.0

1,775.4

1,913.3

1,979.2

2,051.2

2,125.0

Consumer expenditure per capita on food and non-alcoholic beverages (US$)

489.6

539.8

586.9

629.3

648.1

669.1

690.7

Retailer & urban area data

 

Data category

Rank

Urban Area/retailer

Population 
(mns)

 

 

 

 

Top urban areas by population (2015)

1

Jakarta

31.3

Top urban areas by population (2015)

2

Bandung

8.2

Top urban areas by population (2015)

3

Surabaya

6.2

Top urban areas by population (2015)

4

Medan

4.4

Top urban areas by population (2015)

5

Makasssar

2.8

Top grocery retailers by sales (2015)

1

Indomaret

-

Top grocery retailers by sales (2015)

2

Alfamart

-

Top grocery retailers by sales (2015)

3

Carrefour

-

Top grocery retailers by sales (2015)

4

Giant

-

Top grocery retailers by sales (2015)

5

Hypermart

-

 

USDA GATS data

Rank

2015

2014

2013

2012

1

Apples

Lemons

Grapes

Grapes

2

Peppers Grapes Apples Oranges

3

- Cherries Lemons -

4

- Head Lettuce Strawberries -

 

Policy Information

Government Agency(s)/Competent Authority

Authorized Government Agency(s): 

National Accreditation Committee (KAN) provides accreditation service and advice to the National Standardization Agency of Indonesia (BSN), which handles standards development at the direction of the Ministry of Agriculture.

Agency(s) Contact Information: 

Republic of Indonesia - Ministry of Agriculture
Jl. Harsono RM No.3
Ragunan PS. Minggu
Jakarta 12550
Telephone: +62 (0)21 780 4056
Fax: +62 (0)21 780 4237
E-mail: webmaster@pertanian.go.id
Website

Organic Regulations and/or Standards

Name(s) of Regulation and/or Standard: 

On May 2013, Ministry of Agriculture (MOA) issued Regulation No. 64/Permentan/OT.140/5/2013 on Organic Agricultural System (in Indonesian) 

Indonesian National Standards were updated in 2013: Standar Nasional Indonesia (SNI_  6729:2013) Sistem pertanian organik (.pdf in Indonesian)

February 2017: Indonesia repealed National Agency for Drug and Food Control (BPOM) Regulation No. HK 00.06.52.0100 of 2008 on the Control of Organic Processed Food, and added new regulations for organic processed food (Regulation of the Head of NA-DFC No.1 of 2017 on Organic Food); the update includes a chart of materials allowed for use in processed organic foods.

Date of Implementation: 

2002

Regulation and/or Standard Scope: 

The standard establishes a system of organic food production for the following products: fresh plants and plant products, livestock and livestock product production; processed agricultural and livestock products for human consumption.

A draft standard on organic seafood has been prepared by the Ministry of Fisheries and Maritime.

Imported Products Requirements

Imported Products: 

Imported organic foods and fresh organic foods for processing must be accompanied by a certificate from an institution in the country of origin that is accredited by an authority recognized by Center for Standardization and Accreditation in Ministry of Agriculture of Republic of Indonesia.

Based on Ministry of Agriculture regulation 64, imported organic food must be accompanied by:

  • Transaction certificate issued by the Organic Certification Institute (LSO) that has been certified by National Accreditation Committee (KAN) whether it is a domestic LSO or foreign LSO domicile in Indonesia. The LSO must perform certification of the business unit in the country of origin.
  • A health certificate or certificate of sale issued by an authorized institution in the country of origin.

Processed foods that meet the organic processed foods requirements may use the words organic and Indonesia’s organic logo on their labels. Foreign organic logos can be placed next to the Indonesian logo.

 

 

Certification and Accreditation

Certification: 

Type of assurance system: Third party Certification Bodies and second party guarantee systems (NGO, trader)

National Accreditation Committee (KAN) provides accreditation service and advice to the National Standardization Agency of Indonesia (BSN), which handles standards development at the direction of the Ministry of Agriculture. National Accreditation Committee (KAN) recently accredited domestic certifiers; check with your international certifier to see if they are accredited.

The majority of organic farmers in Indonesia are small scale farmers for whom it is difficult to obtain third party certification. For this reason, the Indonesian Organic Alliance (IOA) decided, following a participatory workshop in November 2008, to set-up alternative certification system called PAMOR Indonesia (Penjaminan Mutu Organis Indonesia). The PAMOR system functions according to the Participatory Guarantee System (PGS) model. PAMOR certification is allocated for organic products from small scale producers, marketed at the local, regional, and national level in Indonesia. The product range includes fresh and processed products from food plants and horticulture, as well as livestock and fisheries.

Accreditation Method: 

Government

Accreditation: 

National Accreditation Committee (KAN) provides accreditation service and advice to the National Standardization Agency of Indonesia (BSN), which handles standards development at the direction of the Ministry of Agriculture.

Additional Information

Reference Standards: 

SNI Pangan Organik was drafted to follow the Codex Guideline for production, processing, labeling and marketing of organically produced food and IFOAM basic standards 2005.

Additional Information: 

Definitions

Review definitions of terminology included in this website.