RI projects 6.27% annual growth in plantation sector on output

Zakki P. Hakim, The Jakarta Post, Jakarta

The government believes the plantation sector will grow by an average of 6.27 percent per annum over next five years, spurred on largely by the rapid expansion of output in key commodities, including export-oriented ones, according to the Ministry of Agriculture.

The sector is expected to grow from an estimated 6.01 percent this year to 6.49 percent in 2009, the ministry said in its five- year plan document made available to The Jakarta Post.

The plan sets a target for palm oil output to expand by an average of 6.21 percent to reach 16.74 million tons in 2009 from the estimated 13.15 million tons in 2005. Natural rubber output is expected at 2.34 million tons in 2009, or up by an average of 4.79 percent per year, from 1.95 million tons this year.

It further forecasts cacao output to rise to 778,000 tons in 2009, from an estimated 640,000 tons this year, while coffee is estimated to grow to 892,000 tons in 2009, compared with 750,000 tons in 2005.

Minister of Agriculture Anton Apriyantono explained during a recent meeting with the House of Representatives that the forecast was made based on the past five-year trend.

"The projected output would come from higher yields and by expanding cultivated areas," Anton said.

However, to pursue and maintain such growth of over 6 percent, the sector would need a total investment of Rp 20.52 trillion in the next five years, claimed Anton.

The investment would be directed to accelerating productivity, expanding cultivated areas, developing seedlings, optimizing product processing and marketing, as well as developing supporting institutions.

The projected output expansion would boost exports of the overall plantation sector to grow by an average of 14.42 percent in the next five years, from $7.53 billion in 2005 to $11.87 billion in 2009.

The growth of over 6 percent in the plantation sector would be able to absorb some 7.9 million workers in 2009 from 6.3 million this year.

The plan also revealed that the government would spend its Rp 4 trillion of funds -- allotted from the state budget -- on the development of strategic commodities, which include natural rubber, coconut, oil palm, coffee, cacao, cashew fruit, pepper, sugarcane, fiber and tobacco.

Elsewhere in the document, the ministry is also hoping sugar output can reach 2.85 million tons by 2009, up from this year's 2.16 million tons, as a part of the government's effort to stop sugar imports by 2007.

Tobacco output is estimated to have a high average growth of 7.03 percent in the next five years to reach a production of 307,000 tons in 2009 from this year's estimated 234,000 tons.