Indonesia's Sugar Self-Sufficiency Drive Faces Significant Headwinds

Jakarta – Indonesia's ambitious goal of achieving sugar self-sufficiency by 2030 is encountering significant headwinds, as detailed in a recent report by the Ministry of Agriculture. Despite substantial investments aimed at expanding sugarcane plantations and modernizing processing facilities, the nation continues to heavily rely on imports to meet its escalating domestic demand. The report highlights several critical challenges, including the scarcity of arable land suitable for sugarcane cultivation, intense competition from other vital food crops, and the adverse impact of climate change on agricultural yields. Smallholder farmers, who constitute a large segment of the sugarcane sector, frequently lack access to advanced agricultural techniques and high-quality seeds, resulting in lower productivity compared to international benchmarks. Furthermore, the pace of refinery upgrades has not kept pace with the increasing demand for refined sugar from the burgeoning food and beverage industry. For the current year, Indonesia is projected to import approximately 3.5 million metric tons of raw sugar for refining, in addition to an estimated 1 million metric tons of white sugar. While the government remains committed to its self-sufficiency program, a revised strategy focusing on enhancing existing farm productivity, optimizing land use, and fostering stronger partnerships between farmers and mills may be essential to accelerate progress. This ongoing reliance on imports positions Indonesia as a critical player in the global sugar trade, with its purchasing decisions significantly influencing international market dynamics.