Indonesian Spices Beats hard in the European Market

Indonesian spices products seem to have a lot of interest in the European Union. It is proven by importers from Germany, Indonesia-Consult RS GmbH, buy spices from CV. Multi Spice Sulawesi (MRS) worth US $ 600 thousand. In 2015, Indonesia became the third largest supplier of spices to Germany after Brazil and Vietnam with a share of 16.51 percent. For the last five years, Indonesia’s export of spices to Germany has grown by 14.53 percent with export value of US $ 45.88 million in 2015. The purchase of this spice was achieved through the buying mission program held by the Ministry of Trade of the Republic of Indonesia. This program has proved to be a major contribution to national exports so that it will continue to run on an ongoing basis. This buying mission program is evidence of government support in increasing Indonesian products exports to global markets. The buying mission program can be used by European importers to directly see the products and discuss with Indonesian producers.

Thanks to the cooperation with Indonesian Trade Promotion Center (ITPC) Hamburg, Indonesia-Consult RS GmbH will continue to utilize DG PEN’s facilitation in this buying mission program. According to the head of ITPC Hamburg, with the purchase mission program, this spice product is expected to be able to maintain Indonesia’s spice glory in Europe, especially in Germany. Established since 2006, Indonesia-Consult RS GmbH has the role of bridging communication between Indonesia and Germany with experience with Indonesia and Southeast Asia countries. Indonesia-Consult RS GmbH is a cooperative trading partner in Asia to distribute products to Europe and America. Current concentrated products, ie, spices and herbs, sugar products, nuts, and coffee beans. Meanwhile, CV Multi Rempah Sulawesi (MRS) is known as a producer and exporter of high quality spices from Sulawesi. To get high marks on foodstuff standards, MRS works with 5,000 farmers cultivating over 4,000 hectares of land. MRS focuses on planting environmentally friendly organic products with reference to EU standards and regulations for organic food. MRS has exported its products to several countries, such as Japan, Netherlands, and Germany and continuously expanding its market to European countries.

Indonesia is one of the largest spice producers, while the EU is one of the largest markets for spice products.

Indonesia is rich with spice diversity. Some of the commodity spices that are traded in the international market are pepper, nutmeg, vanilla, cinnamon, cloves, cardamom and ginger. Of the many commodities of spices, pepper and nutmeg is the main commodity in the world spice trade, as well as Indonesia’s superior export products compared to other commodities.

According to data released by the Food and Agriculture Organization (FAO) in 2016, Indonesia ranks first in the world’s vanilla and clove producers and ranks the 2nd global pepper and pepper producer in 2014. In addition to the German market, Launched data from the Agency for the Assessment and Development of Trade Ministry of Commerce, there are several countries that became the export destination of Indonesian spices. Among others, the United States, the Netherlands, Pakistan, Bangladesh, Germany, Canada, Belgium, India, Spain, Egypt, Peru to South Korea.

Spices is Indonesia’s fourth largest export commodity, after shrimp, fish and coffee. Pepper became the spice that has the most important role in this sector for Indonesia’s economic growth.

As one of the world’s spice producers, Indonesia has a great opportunity as a supplier of the world’s spices to contribute to the Indonesian economy. One effort that can be made to improve the competitiveness and promotion of selected commodity priority of selected spices is to develop Geographical Indication (IG). Geographical Indication is the name of the place or designation used to identify commodities originating from a specific geographic area, which has special qualities, characteristics and reputations directly related to its origin region, caused by natural factors and traditional practices (EU-TCF, 2016). Geographical Indications are also part of Intellectual Property Rights.

In addition to meeting domestic needs, Indonesia also has the opportunity to become the world’s top exporter of spices currently occupied by India, Vietnam and China. Therefore, the development of focused exports becomes very important to be able to formulate export development strategies as well as efforts to open market access. To know priority export commodities in the framework of export development, commodity mapping is done by looking at the growth of Indonesia’s exports to the world as well as the growth of world imports.