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Quick Stats

Quick Stats

Organics Dashboard From Passport

  • Kampung Kearifan Indonesia PT leads the organic segment in Indonesia with a market share of 24.0%, followed by UD Padi with a share of 15.3% in 2019.
  • With a low market size ranking, accompanied by a single digit forecast growth and per capita expenditure, the market of organic products in Indonesia is still to emerge, as only a handful of categories dominate the majority of sales for packaged food and beverages.

  • Organic products in Indonesia represent roughly 0.02% of global demand, with a per capita expenditure of US$0.05 in 2019.
  • With a growing number of consumers interested in organic products and an emerging economy in Indonesia, the potential for organic products seems positive in the long term, leading to a forecast value CAGR of 3.5% for the period 2019-2024.
Qualitative Analysis

Qualitative Analysis

Quick Facts
  • Organic packaged food and beverages in Indonesia continue to grow, increasing by 6.9% in 2019 to reach a value of approx. US$14 mn.
  • Organic packaged food sales primarily consist of organic rice, which contributes virtually 100.0% of sales and records a current value growth of 3.0% in 2019.
  • Organic coffee is currently the only major beverage category present in Indonesia, which registered a value growth of 9.0% in 2019.
Market Trends
  • The market for organic products in Indonesia is in its early stages, with organic packaged food and beverages consisting of a total of 2-3 subcategories. Consumer awareness of the importance of organic products as well as its supply is still to grow.
  • The primary consumer segments are high-income consumers, as organic products have minimal distribution and are highly priced. As Indonesia is still an emerging economy, the outlook of organic products is expected to remain low, anticipated to record a market size of US$16.5 mn by 2024.
Competitive Landscape
  • As Indonesia is an agricultural country with a substantial rice-based agricultural economy, local manufacturers dominate organic rice. Kampung Kearifan Indonesia PT remains the leader in organic rice, with its famous brand Javara. Since its launch in 2008, Javara has been a pioneer in organic rice and recorded marginal level sales in other organic packaged categories such as noodles, nuts and herbs and spices. Furthermore, the company markets its products referencing its organic certification, which gives it the ability to export to Europe and the US, among other countries.
  • Other organic packaged food categories such as organic dairy and baby food, which are dominated by international brands, have marginal sales. While these products are currently niche items in Indonesia, the pursuit for healthier and cleaner products among the local population indicates that the presence of organic packaged food is expected to further expand beyond organic rice during the forecast period.
  • Kampung Kearifan PT is also the leader in organic coffee, owing to its Javara umbrella brand's strong position, which also leverages the high number of specialist coffee stores operated under the name Javara Cultere Cafe. All of the menu items on offer in Javara specialist coffee shops are cultivated and produced in Indonesia, using 100% organic ingredients. Javara Cultere Cafe is also Indonesia's first major player in organic foodservice, and the brand's concept explicitly caters to consumers who wish to support Indonesian farmers and manufacturers.
Prospects And Growth Opportunity
  • Despite the limited presence of organic packaged food in Indonesia, organic products are relatively popular in the fresh food industry, with a growing number of Indonesian consumers becoming increasingly health-conscious and knowledgeable about the food they consume. Furthermore, fresh organic produce is available through various traditional and modern retail channels. With knowledge of the benefit of organic products spreading, there remain substantial growth opportunities for organic packaged food. However, marketing campaigns will likely be needed to boost product awareness.
  • Organic hot drinks are expected to witness an increase in product launches. Many of these are available mainly or exclusively via internet retailing, including HiBO organic coffee, which is grown free from pesticides and herbicides at 2,000m altitude in the Indonesian territory of West Papua.
  • M-commerce and app-based marketing are likely to become more critical as Indonesian consumers are increasingly connected via the internet and smartphones. This high level of connection allows brands to reach out to consumers easily via apps and mobile-friendly websites. Consumers are frequently interacting with brands online, including making purchases and sourcing information about products, generally via their smartphones.
General Health And Wellness Trends
  • Consumers in Indonesia are increasingly concerned about their health and wellness, focusing more on the ingredients in their food. This is explicitly apparent in the category of baby food, with parents paying a considerable premium to ensure they provide the healthiest option possible for their children.
  • The limited distribution of organic packaged food products is likely to remain an impediment on category sales during the forecast period 2019-2024. However, organic packaged food is slowly gaining traction, as consumers are increasingly knowledgeable through the internet. Yet, this trend is limited to high-income areas of major cities such as Jakarta, Medan, Semarang and Surabaya. In premium modern grocery retailers’ outlets such as FoodHall and Ranch Market, a wide range of organic products can be found, including organic baby food brands such as Milna Organic Red Rice Porridge as well as other categories such as organic milk and milk alternatives, including Natur-a, a popular organic milk brand.
General Economics And Demographic Landscape

Economy:

  • The economy of Indonesia is expected to perform well, with real GDP growth recording 5.0% in 2019, post growth of 5.2% in 2018. A vital factor of the slower growth is the downturn of exports among key partners, coupled with subdued commodity prices.
  • The real value of private consumption grew by 5.1% in 2019, similar to growth in 2018, supported by rising incomes and controlled inflation.
  • Unemployment declined from 5.2% in 2018 to 5.1% in 2019. This increase in employment is beneficial, yet marginal, as about 70.0% of workers are in the informal sector, with most falling below minimum wage.
     

Population demographics:

  • The population of Indonesia reached 267 million in 2018, increasing by more than 55 million from 2000, indicating an increase of about 26.0% for the period 2000-2018.
  • Indonesia enjoys the benefits of a primarily youthful population, as the median age in 2018 was 28.8 years, increasing by 4.7 years since 2000. Fertility reached a rate of 2.3 births per female in 2018, with a decrease to 2.1 births per female expected by 2030.
  • As fertility declines, Indonesia will experience a moderate ageing process. The proportion of the population over 65 years totalled 14.5 million in 2018, representing 5.4% of the total population. This figure is expected to rise to 8.3% by 2030.
     

Income & expenditure:

  • The savings ratio in Indonesia is about a quarter of the regional average, reaching 6.1% of disposable income in 2018 as well as 2019.
  • Consumer expenditure per capita amounted to US$2,177 in 2018 and increased by 3.7% in 2019 to reach U$2,257. Overall, consumption is expected to witness a cumulative increase of 69.6% for the period 2019-2030, averaging an annual rate of 4.9%.
  • Disposable income per capita reached US$2,311 in 2018 and grew by 3.6% in 2019 to reach about US$2,400. For the period 2019-2030, total disposable income is expected to witness a cumulative increase of 69.3%, recording an annual rate of 4.9%.
Data

Data

Organic Packaged Food And Beverage Data

Data type

Unit

2016

2017

2018

2019

2020

2021

2022

CAGR
(16-19)

CAGR
(20-22)

Health & wellness products consumption

USD million

8,617.3

9,103.2

9,717.0

10,375.1

10,678.2

10,928.1

11,153.6

6.4%

2.2%

Organic packaged food and beverages consumption

USD million

11.1

12.1

13.0

13.9

14.4

14.8

15.4

7.8%

3.4%

Organic packaged food consumption

USD million

10.1

10.8

11.6

12.4

12.7

13.1

13.6

7.1%

3.5%

Organic beverages consumption

USD million

1.1

1.2

1.4

1.5

1.6

1.7

1.8

10.9%

6.1%

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 And Demographic Data

Data type

Unit

2016

2017

2018

2019

2020

2021

2022

Total population

million

261.6

264.7

267.7

270.6

273.5

276.4

279.1

% Middle and upper class of total population

%

28.5

28.8

29.0

29.3

29.5

29.7

29.8

% Population aged 65+

%

5.5%

5.7%

5.8%

6.0%

6.3%

6.5%

6.8%

% Population aged 0-14

%

27.2%

26.8%

26.5%

26.2%

25.9%

25.7%

25.4%

% Population with higher education degrees

%

8.2

8.3

8.5

8.6

8.7

8.8

8.9

Average number of children per household

children

1.3

1.3

1.3

1.2

1.2

1.2

1.2

GDP per capita

USD per capita

3,351.1

3,629.2

3,917.9

4,135.1

4,276.9

4,457.3

4,639.0

Consumer expenditure per capita (US$)

USD per capita

1,900.2

2,040.5

2,190.9

2,338.5

2,428.9

2,527.2

2,630.8

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

USD per capita

601.1

650.0

705.6

754.6

779.3

810.4

843.7

Retailer And City Data

Top 5 Cities By Population

Data category

Rank

City/retailer

Population
(millions)

Top cities by population (2019)

1

Jakarta

32.3

Top cities by population (2019)

2

Bandung

8.8

Top cities by population (2019)

3

Surabaya

7.7

Top cities by population (2019)

4

Semarang

4.9

Top cities by population (2019)

5

Medan

4.6

Top 5 Grocery Retailers By Sales

Data category

Rank

City/retailer

Top grocery retailers by sales (2019)

1

Sumber Alfaria Trijaya Tbk PT

Top grocery retailers by sales (2019)

2

Salim Group

Top grocery retailers by sales (2019)

3

Trans Retail Indonesia PT

Top grocery retailers by sales (2019)

4

Dairy Farm International Holdings Ltd

Top grocery retailers by sales (2019)

5

Matahari Putra Prima Tbk PT

United States Department Of Agriculture Global Agricultural Trade System Data

Top 5 Export Commodities To Indonesia

Year

Country

Rank of
Product/Commodity

Product/Commodity

Export Value (US$)

2019

Indonesia

1

Organic Apples Fresh

1,220,598

2019

Indonesia

2

Organic Grapes Fresh

307,750

2019

Indonesia

3

Organic Vinegar and Substitutes

127,092

2019

Indonesia

4

Organic Oranges Fr/Dr

98,820

2019

Indonesia

5

Organic Lemons Fr/Dr

84,442

2019

Indonesia

Total

Total Organics*

1,895,511

2018

Indonesia

1

Organic Grapes Fresh

1,219,066

2018

Indonesia

2

Organic Apples Fresh

475,540

2018

Indonesia

3

Organic Vinegar and Substitutes

309,545

2018

Indonesia

4

Organic Oranges Fr/Dr

61,020

2018

Indonesia

Total

Total Organics*

2,065,171

2017

Indonesia

1

Organic Apples Fresh

1,244,594

2017

Indonesia

2

Organic Grapes Fresh

840,480

2017

Indonesia

3

Organic Coffee Roast Not Decaf

62,174

2017

Indonesia

4

Organic Lemons Fr/Dr

44,000

2017

Indonesia

5

Organic Limes Fr/Dr

25,920

2017

Indonesia

Total

Total Organics*

2,217,168

2016

Indonesia

1

Organic Apples Fresh

1,848,409

2016

Indonesia

2

Organic Grapes Fresh

1,344,250

2016

Indonesia

3

Organic Lemons Fr/Dr

75,600

2016

Indonesia

4

Organic Limes Fr/Dr

27,090

2016

Indonesia

5

Organic Coffee Roast Not Decaf

25,661

2016

Indonesia

Total

Total Organics*

3,398,409


Note : Total organics is the sum of all exports in a particular year 
Definitions

Definitions

Term

Definition

Health and Wellness

Health and wellness is the aggregation of organic packaged food and beverages, fortified/functional packaged food and beverages, naturally healthy packaged food and beverages, better for you packaged food and beverages and food intolerance products.

Organic packaged foods and beverages

This category includes packaged food & beverages that are certified organic by an approved certification body. Organic production is based on:

• A system of farming that maintains and replenishes soil fertility without the use of toxic and persistent pesticides and fertilizers.
• Organic food & beverages are minimally processed without artificial ingredients, preservatives or irradiation.
• The use of GMOs (Genetically Modified Organism) is prohibited. “Certified Organic” means the item has been grown according to strict uniform standards that are verified by independent state or private organizations.
• Depending on the country, such products are called ‘organic’, ‘biological’ or ‘ecological’: For organic products to be included under Euromonitor definitions, the organic aspect needs to form part of positioning/marketing of the product. This is an aggregation of organic baby food, bakery, confectionery, dairy, ice cream, oils and fats, ready meals, rice, sauces, dressings and condiments, snack bars, soups, spreads, sweet and savory snacks and other organic food.

Note that fresh food products or individual ingredients are not included in this definition.

Compound annual growth rate (CAGR)

The compound annual growth rate (CAGR) is the average annual growth rate over a specified period of time. For instance, the CAGR consumption of from 2016 – 2019 will be the average growth rates across these three years.

USDA GATS data clarification

The data presented in table 2.4 represents the dollar values of the top 5 organic commodities as well as of the total organic exports of the trade partner for the period 2016-2019 as per the United States Department of Agriculture’s Global Agricultural Trade System, a database consisting of international agricultural, fish, forest and textile products trade statistics dating from the inception of the Harmonized coding system in 1989 to present.

Policy Information

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 2016: 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

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:

USDA's GAIN Report Indonesia Retail Foods Retail Foods Update (2019)
USDA's GAIN Report Indonesia Food Service - Hotel Restaurant Institutional (2019)
USDA's GAIN Report Indonesia Food Processing Ingredients (2020) 
USDA's GAIN Report Indonesia Food and Agricultural Import Regulations and Standards - Narrative (2020)
USDA's GAIN Report Food and Agricultural Import Regulations and Standards Export Certificate Report (2020)
USDA's GAIN Report Indonesia Exporter Guide (2019)
USDA's GAIN Report Retail Product Registration Guide for Imported Food and Beverages (2018)