Indonesia's nutmeg trade on the wane after 500 years

Indonesia's nutmeg trade on the wane after 500 years

Peter Janssen, Deutsche Presse-Agentur, Jakarta

Indonesia's nutmeg trade is on the decline after five centuries
of being the root cause of wars, massacres and ultimately the
colonialization of this sprawling archipelago nation.

From production in the mid-1990s of more than 10,000 tons of
nutmeg per annum, Indonesia's nutmeg output fell to less than
6,000 tons last year, and the trend is downwards for the near
future.

"Indonesia, the way it's going now, is gradually getting out
of the nutmeg business," said Kees Valk, marketing director for
P.T. Unipro Indonesia, one of the world's leading nutmeg traders.

Unipro blames Indonesia's declining role in the world nutmeg
market on recent years of poor weather, political unrest, growing
competition and the local industry's failure to put in place
better quality controls and to plant new trees.

Ironically, it is Britain's former colonies -- Grenada, India
and Sri Lanka -- that are squeezing the former Spice Islands,
prize of the Dutch East Indies Company (VOC), out of the spice
trade it once monopolized.

In 1511 the Portuguese discovered the Banda islands, six tiny
volcanic lumps in the Maluku archipelago (formerly Maluccas),
situated about 2,475 kilometers east of Jakarta, which were to
have a disproportionate impact on Indonesian history, not to
mention New York's.

The Bandas were the original source of nutmeg, the large seed
of the nutmeg tree which is only indigenous to the six remote
islands.

Four centuries ago nutmeg was worth its weight in gold in
Europe, where physicians touted it as a panacea capable of curing
plague, impotency, depression, not to mention as a great
preservative for rotting meat during an age of no refrigeration.

By 1664 the Dutch had driven the Portuguese and British out of
the Bandas, but at a steep price.

In that year, the Dutch government handed over the island of
Manhattan -- then a small trading post in the New World of
America -- to the British in exchange for their claim on Run
Island, part of the Banda chain.

Annoyed by local opposition, the VOC massacred and rounded up
the remaining population of Bandanese and shipped them to Batavia
(Jakarta) to be sold as slaves, leaving the islands to be devoted
solely to nutmeg growing by Dutch plantation owners.

A Dutch monopoly over the nutmeg trade lasted until the 1811
to 1816 period, when Java temporarily fell under the British, who
used the occasion to transplant nutmeg trees in their colonies in
Penang, Sri Lanka, India and Grenada, a volcanic island in the
Caribbean.

For the past century Indonesia and Grenada have been the
world's top suppliers of nutmeg, now no longer deemed a panacea
but still an important spice and preservative in such mundane
products as German sausage.

World demand in 2002 for nutmeg and mace, the red, lacelike
covering of the nutmeg shell, is estimated at about 9,000 tons,
with Europe accounting for 42 per cent, the U.S.A. for 26 per
cent and others for the remainder.

Indonesia's exports of nutmeg/mace this year are estimated to
reach 5,500 tons, compared with Grenada's 2,000 tons and 1,200
tons from Sri Lanka/India, according to Unipro.

While Indonesia continues to be the largest nutmeg producer,
traders claim it is losing market share in Europe, due to
stricter health regulations on alfa-toxins and no serious quality
controls in Indonesia.

"Grenada has fantastically organized its whole business," said
Unipro's Valk. "They actually test for alfa-toxins in Grenada,
and they have agents in the U.S. and Europe who replace parcels
that have been rejected."

Indonesia has no such system in place.

"So what we see now is many European buyers shifting to
Grenada," said Valk. "The only advantage for Indonesia is that
Grenada's production is far too small."

Meanwhile, on the price-conscious, less quality-conscious end
of the nutmeg market, such as sausage makers in Eastern Europe
and China, Indonesia is losing out to nutmegs from Sri Lanka and
India, which are smaller but cheaper.

Indonesia's inherent advantage in the nutmeg business is that
the spice originated in the Banda islands, and has been
transplanted with good results to numerous other islands such as
Ambon and Siau.

Ambon's nutmeg trade, unfortunately, has been interrupted by
three years of religious strife on the island, and Siau - a small
volcanic island that currently produces 60 per cent of the
country's nutmeg crop - is threatened by the islanders' failure
to plant new trees.

Ironically, the Banda islands have ceased to be a major source
of nutmeg for the past twenty years, due to neglect of the
plantations there.

Des Alwi, the so-called "Nutmeg King" of the Bandas, is trying
to re-establish the island of Banda Naira as a nutmeg producer,
with a plantation he started in 1997 of some 50,000 new nutmeg
trees.

"We consider the nutmeg the heritage of Banda," said Des Alwi,
who also chairs Banda's Culture and Heritage Foundation. "You
can't neglect the nutmeg, because a lot of people died for it."