Indonesia: Tobacco Exports Plunge over Past 5 Years

Source from:  The Jakarta Post  05/19/2014

The country's tobacco exports nosedived over the past five years by 66 percent largely because of lower quality tobacco produced by local farmers, the Agriculture Ministry says.

Tobacco exports dropped from 110,000 tons in 2008 to only 37,000 tons in 2013.

"The fall resulted [mainly] from a continuous decline in the quality of tobacco produced by farmers," the ministry's director general for plantations, Gamal Nasir, said on Friday as quoted by tempo.co.

"Another factor was weak global demand for Indonesian tobacco," he added.

He said the decline in tobacco exports could create a negative backlash in the upstream sector, which might cut production because of sluggish market demand.

"A decline trend in tobacco exports could lead Indonesia to import tobacco in the future," Gamal said, adding Indonesia could lose around US$1.5 million per year from overseas tobacco sales.

Indonesia exports its tobacco to Malaysia, the United States, Belgium, the Netherlands and Germany. Enditem