Soybean imports

Kompas – January 6, 2021

Sack reads: Imported soybeans, No 1 quality soybeans.

Famer's hat reads: self-sufficiency

In early January tempeh and tofu disappeared from the market as producers went on strike to protest the soaring price of soybean, the primary ingredient of the popular food, which is mostly imported.

Reports said prices surged due to rising demand by the world's biggest importer, China, and falling global supplies.

According to the National Statistics Agency (BPS) Indonesia imported around 2.11 million tons of soybeans from January to October last year alone, 90 percent of which came from the US. Indonesia consumed an average of 3.2 million tons annually over the last five years, 2.67 million tons of which came from imports.

The main causes of the country's soybean deficit are the small acreage and low yield. A BPS survey found that 60 percent of soybean crops were cultivated in paddy fields alongside shallots and red chili. A BPS survey in 2017 also discovered that soybean cultivation was less profitable than other crops, making it unattractive to farmers.

Many farmers have therefore shifted to other crops and according to the BPS the number of soybean farmers fell by 59 percent to 275,000 in 2018 from 672,000 in 2013.

At the beginning of his first term in office in 2014, President Joko "Jokowi" Widodo pledged to achieve soybean self-sufficiency within three years – and threatened to fire the agriculture minister if this did not happen.

But despite a 200-day agricultural ministry program to boost production through partnerships with investors, productivity remained low averaging only 1.5 tons per hectare in 2019 compared with 3 tons in the US. Imported soybeans also remain more popular because of their higher quality and lower prices.

In order to achieve self-sufficiency, soybean crops would need some 2.5-3.5 million hectares of cultivation, but the harvested area has actually declined from 0.61 million hectares in 2015 to 0.18 million in 2019.

Regions outside Java have significant potential for soybean cultivation. Surveys show that soybean yields in Bengkulu province in Sumatra could reach 2.2 tons per hectare, West Sulawesi 3.1 tons and Papua 2.4 tons. Unfortunately, the three provinces accounted for only 6 percent of the total harvested area in 2019.

In terms of government policy to address the issue however, quality data on soybean production is lacking and since 2016 the BPS has stopped disseminating the official figures to questionable reliability of the data.