Tofu, tempeh business not full of beans

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."