Recent Study: Indonesia Agribusiness Report Q1 2014

Overall, we hold an optimistic outlook on Indonesia's agriculture sector and see significant growth opportunities in sub-sectors such as livestock, palm oil and cocoa. However, while we believe the government's goal to reach self-sufficiency in rice by 2015 is attainable, we are less confident about other commodities such as sugar and corn. We also highlight that the country's aim to become the second largest coffee producer in the world by 2015 is unrealistic. Much of our scepticism relates to the lack of proper infrastructure and the existence of a large number of low-technology, small-scale farmers. We believe the shift from raw commodity exports to refined exports (especially for palm oil and cocoa) will warrant more public and private investment in order for the raw inputs industry to keep pace with downstream industries. Investments by Wilmar, Golden Agri Resources and Barry Callebaut are clear signs of the growing interest in these sectors.

Key Forecasts

Full Report Details at
- http://www.fastmr.com/prod/723582_indonesia_agribusiness_report_q1_2014.aspx?afid=301

* Rice production growth to 2016/17: 14.6% to 41.0mn tonnes. We believe Indonesia will attain its goal of being self-sufficient in rice in the coming years, as the country is expanding initiatives to boost production. Growing use of high-yielding paddy varieties and agriculture intensification will help output to record higher growth rate than in the past.
* Sugar consumption growth to 2017: 27.9% to 6.5mn tonnes. Consumption growth will continue to outstrip production growth, driven by rising incomes, greater urbanisation, population growth and the growing demand from the food and beverage industry.
* Beef production growth to 2016/17: 5.3% to 485,000 tonnes. Output growth will come from increased domestic demand as well as further government support. Indeed, Indonesian authorities are looking to be self-sufficient by 2014.
* BMI universe agribusiness market value: US$61.7bn in 2014 (up from US$57.4bn in 2013; forecast to grow annually by 5.5% on average between 2013 and 2017).
* 2014 real GDP growth: 5.4% (down from 5.8% in 2013; forecast to grow annually by 6.1% on average between 2013 and 2017).
* 2014 consumer price index: 5.0% year-on-year (y-o-y) (down from 5.4% y-o-y in 2013; forecast to grow annually by 5.1% on average between 2013 and 2017).
* 2014 central bank policy rate: 6.50% (down from 5.25% in 2013; forecast to average 6.95% from 2013 to 2017).

Key Revisions To Forecast

* Cocoa 2012/13 and 2013/14 production forecasts revised down, to 455,000 tonnes and 475,000 respectively (compared with previous forecasts of 465,000 and 480,000 tonnes respectively). This is mainly because diseases are affecting yield and area expansion. Output growth is being hampered by poor agronomic practices, poor-quality planting materials and the abundance of aging, less productive trees, which render the sector more prone to severe weather patterns.

About Fast Market Research

Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.

For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.

You may also be interested in these related reports:

- France Agribusiness Report Q1 2014
- India Agribusiness Report Q1 2014
- Pakistan Agribusiness Report Q1 2014
- Ghana Agribusiness Report Q1 2014
- Russia Agribusiness Report Q1 2014