The Indonesian Chamber of Commerce and Industry launched a "cassava unit" on Thursday to prop up the country's cassava production in response to a growing demand for bio-ethanol supply.
The unit, an official of the chamber said, should increase cassava production from current 10 tons per hectare to 30 tons per hectare through a land extensification and intensification program.
"Indonesia's cassava industry has great potential, particularly because the country has large areas that could be used for new high productivity cassava plantations," said Noes Soediono, vice chairman for food and agro-industries.
Noes said the country's total cassava output, which has traditionally catered only to local food needs, is beginning to be absorbed by a demand for bio-ethanol production.
"The industry should be directed to take advantage of the growing global biofuel energy trend," she said.
Also speaking during the launch, National Committee for Biofuel Promotion chairman Alhilal Hamdi said the country's cassava productivity was inferior to neighboring producers, including Thailand, which produces 20 to 30 tons per hectare.
"If Indonesia can increase its production capacity to just twice its current level, not only will the country be able to become self-sufficient in the production of cassava as food, but also there will be plenty available for bio-ethanol production," he said.
Hamdi said the government needed to promote cassava as more than a food source by educating people about its potential as an energy source.
"Demand for energy will never cease. World oil prices have been predicted to reach around US$120 to $150 per barrel by the middle of this year," he said.
Hamdi also described four strategies to promote the industry.
The unit itself, he said, should encourage the research and development of seeds, industry expansion, stronger government support and integration of the upstream industry, or plantations, with the downstream industry, or bio-ethanol manufacturers.
"The government needs to give incentives for cassava farmers and to offer tax relief for research and development projects," Hamdi said.
Speaking to The Jakarta Post, bio-ethanol producer PT Indo Biofuels Energy director Lucia Liemesak said failed government policies on alternative fuels had caused biofuel production to drop by 85 percent since December last year.
"The industry has suffered from a lack of incentive, contrary to our competitors in other countries, where, not only do farmers and biofuel producers get incentives, but also users," she said.
To boost the competitiveness of local producers, she said, the government must consider subsidizing state oil company Pertamina's total spending on biodiesel. (uwi)
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