Export of rattan not profitable

Export of rattan not profitable

JAKARTA (JP): Few rattan traders have entered overseas markets
despite the government's removal of its rattan export ban last
month, a minister has said.

Minister of Forestry Djamaludin Suryohadikusumo said yesterday
that overseas markets for raw and processed rattan were not as
promising as several years ago.

He said many rattan furniture companies in Japan, South Korea
and Taiwan have closed their operations after Indonesia, the main
supplier of raw rattan in the world, banned the export of raw and
semi-finished rattan in 1989.

"That's why selling rattan overseas is no longer attractive,"
the minister said.

He said the ban not only hit the rattan industry overseas but
also domestic rattan furniture producers because the export
restriction caused a sharp drop in the price of rattan furniture
in the domestic market.

"The situation also forced most rattan gatherers to stop
collecting rattan in forests and instead work in the illegal
timber trade," Djamaludin said.

He said before the government ban, the price of thin rattan
was Rp 600 per kilogram and Rp 2,000 per kilogram for thick
rattan. Currently thick rattan sells for Rp 200 per kilogram, a
price that cannot meet gatherers' operational costs.

"The supply of raw rattan for the furniture industry has dried
up due to a sharp decrease in the number of rattan gatherers," he
said.

Djamaludin added that most traditional rattan-processing
industries in Kalimantan and Sulawesi -- which produced mainly
semi-finished rattan -- and rattan furniture industries in Java
have gone bankrupt.

He said the number of rattan processors in Sulawesi have
fallen by over 25 percent and in Kalimantan by over 50 percent in
the eight years following the ban.

Exports of rattan-related products fell 21 percent to US$286
million last year from $360 million in 1996, of which about 32
percent were exported to Japan.

Djamaludin said the growth of processed rattan exports has
declined by 20 percent per year in the past five years due to the
scarcity of raw rattan.

The government reduced export taxes on rattan to a maximum of
10 percent from Feb. 1 as a part of reforms agreed to with the
International Monetary Fund.

The government ban on the export of raw and semi-finished
rattan was aimed to promote the development of the country's
furniture industry. (gis)