Tofu, tempeh business not full of beans

By Kafil Yamin

BANDUNG (JP): Lilis Syarifah had just returned from school when she reopened her father's small tofu factory. But the 19- year-old would only serve those who came to her mill in Cibuntu, one of the tofu producing centers in Bandung.

"We have dared not operate our factory in the last three days. If we did, other tofu-makers would stone our house," she told The Jakarta Post earlier this month.

Thousands of tofu producers have been forced to halt their operations because of scarce supplies of soybeans, the raw material for tofu and tempeh, staples in the Indonesian diet.

"And those who still had soybeans and kept operating their mills were regarded as not showing solidarity. So the people stoned them," Syarifah explained.

Production of tofu and tempeh is a home industry in Bandung and other West Java areas. Most factories are run by families from their residences.

The shutdown in operations was also meant as a protest against the government's inability to maintain the distribution of soybeans, a commodity under the monopoly of the National Logistics Agency (Bulog).

With the government's recent agreement with the International Monetary Fund which included a recommendation to end Bulog monopolies, Syarifah believed more gloomy days lay ahead as soybeans were still hard to find in markets.

Bulog has stopped selling soybeans until a new price is set.

In Bandung alone, 600 tofu and tempeh factories have reportedly gone out of business, and hundreds more are barely hanging on.

Demand for soybeans is being met through imports, mostly from the U.S.

Bulog could adjust prices to ensure affordability for local buyers and avoid fluctuations by maintaining stocks.

With the monopoly now being dismantled, producers will be thrown directly into the free market. Before this has even been done, harbingers of hardship ahead are already emerging.

Soybean prices have skyrocketed from Rp 1,200 per kilogram to Rp 2,300. Producers such as Syarifah have tried to contain the price increase to 10 percent, but sales have still dropped steeply.

"Normally, 70 kilograms, or some 2,100 pieces of medium-sized tofu, could be sold. Now, after we increased the price by only Rp 10 (from Rp 90 to Rp 100), we could only sell 20 kilograms, or 600 pieces," Syarifah said.

"The more we increase the price, the more buyers will leave us."

Like other producers, Syarifah is producing smaller-sized tofu to maintain the lower prices.

"What we are doing is trying to survive. To survive is still better then to die," she said, citing several factories in her neighborhood which had closed.

Akil Dermawi, chairman of Cooperatives of Indonesian Tofu and tempeh producers (Kopti), said soybean stocks were actually sufficient.

"Bulog is now keeping 60 tons of soybean in its warehouse in Cikande, Serang. The amount is enough to meet demand from tofu and tempeh producers," Dermawi said.

Demand is between 45,000 tons and 50,000 tons per month. Bulog supplies 50 percent of this, with the remainder met by the market.

Head of Bulog's Bandung regional branch, Ahmad Riduardy Bastary, said he was only following orders to temporarily stop distribution pending the announcement of a new price.

"After all, Bulog should increase the price as the market has," he said.

Bulog's price rate was 1,260 per kilogram until Jan. 12, when it announced a new price rate of Rp 1,800 per kilogram.

Another commodity dependent on soybean supplies is tempeh, which has begun to find a good export market in Japan.

As with tofu producers, thousands of tempeh factories are idle. In Cianjur, a tempeh centers in West Java, the product has disappeared from the market as more than 170 tempeh and tofu producers are lacking supplies.

Consumers are not the only ones hurting. With 40,000 tofu and tempeh factories nationwide stopping production, 200,000 people have lost their jobs.

Ironically, this has occurred when the producers are gaining ground in markets overseas. Dermawi said the market for tempeh in Japan was growing, but problems still needed to be overcome.

"Tempeh's shelf life is short. For exports, we need to add technology to make it last longer," Dermawi said.

But he was optimistic about prospects for the tofu and tempeh market domestically. He hoped factories which had been closed down would resume operation.

"Indonesians cannot take tempeh and tofu off their daily menu," he said. "Even when the price goes up, they will still buy, even though there may be a negative reaction at the beginning."