Indonesian tea products are actually one of the best quality assets in the world. For Indonesia, tea plays an important role as a contributor to the country’s foreign exchange, poverty alleviation for rural communities, and environmental preservation.
According to data from the Coordinating Ministry for Economic Affairs for 2020, Indonesia is ranked the thirteenth largest tea exporter in the world, supplying 45,265 tons of tea or US$96,326 thousand.
However, amidst the trend of increasing global tea consumption, the condition of the Indonesian tea sector is currently sluggish and requires more attention. This decline in performance was equally faced by the three main actors, namely State-owned Plantations, Private-owned Plantations, and Smallholders’ Plantations.
Nevertheless, smallholders who manage plantations independently are the most vulnerable but must be able to survive. Farmers with a series of limited capital, capabilities, and technology are generally less flexible in dealing with dynamic market conditions. So soon there must be a change.
Start Abandoned
Nearly half (46 percent) of Indonesia’s tea plantations are cultivated by farmers, while 34 percent are managed by the state and 20 percent are managed by the private sector. Even though it has the largest plantation area, the productivity of the people’s tea gardens is actually the smallest.
Of the 144,064 tonnes of Indonesia’s dry tea production in 2020, 40 percent is produced by State-owned Plantations, 35 percent by Smallholders’ Plantations, and 25 percent by Private-owned Plantations (BPS 2021).
This is because the majority of tea smallholders still sell fresh tea shoots, so there is no value added to the product and prices still depend on collectors in their respective areas.
As a result, farmers often receive whatever price the collector or processing plant determines. So that an unequal power relationship is formed because the number of collectors is far less than the number of farmers in one area.
So do not be surprised if a number of farmers began to leave the tea plantations and look for other alternative jobs, such as laborers, employees, or traders. Even today’s younger generation is not interested in continuing tea that has been passed down for generations, most of them choose to migrate to get better wages.
Building Brand
This condition is even more concerning with the rate of decline in the area of tea plantations, which in the last two decades has decreased by an average of 1,000 hectares per year. Nationally, the area of tea plantations has decreased a lot, from 166,867 hectares in 2001 to 144,064 hectares in 2020 (BPS 2021).
Tea is no longer seen as profitable for farmers, so many are converting land into other commodities.
On the other hand, not many farmer groups and cooperatives have done independent processing to cut the supply chain. The reasons vary, ranging from difficult access to capital, lack of management, to dependence on government assistance and companion institutions.
According to the Chairman of the Lestari Farmers Association Waras Paliant, “Farmers are at the very end of the supply chain with all its limitations. The high dependence on other actors also places them in a lower bargaining position, so there must be innovative solutions to change this condition. One of them is what we (the association) did with the farmers by developing a people’s tea product which we have named the brand ‘Teh nDeso’.”
Rely on People’s Plantations
In addition, the flood of tea imports in the Indonesian market is also caused by Indonesian consumers who prefer tea products at lower prices. This makes tea-based beverage manufacturers prefer to import low-quality tea at lower prices. If this condition continues, it will certainly be detrimental to the Indonesian tea sector and will certainly have a negative impact on all tea farmers.
Ratri Kustanti Director of ITMA (Indonesian Tea Marketing Association) said, “ITMA will always provide support for people’s tea products, because the future of the Indonesian tea industry is very dependent on people’s plantations, given that land ownership is dominated by them. Therefore, we invite the younger generation, especially those working in the F&B, cafe and food SME sectors, to help promote and use products made from people’s tea.”
Little by little, farmers are now starting to realize their important role in the supply chain and are making collective improvement efforts through farmer groups or cooperatives. Among them by utilizing cooperatives as collectors to cut supply chains, implementing Good Agricultural Practice, to product diversification to increase the added value of crop yields.
In fact, a number of Indonesian tea centers have developed their own regional brands of tea which are produced independently as an actualization of farmer involvement in the agribusiness industry. One of them is Teh nDeso, a tea brand founded by the Paguyuban Tani Lestari and sourced directly from smallholder tea plantations in West and Central Java.
Business Owners and Actors
Through this business unit, farmers are not only producers of raw materials, but also brand owners and business actors in the tea industry. Thus, the life of the farming family can be better along with the increase in human resource capacity, improvement of the people’s tea gardens, and the competitiveness of their products.
According to Nanang Christianto, the manager of the nDeso Tea brand, this tea product is produced from quality tea shoots which are only taken from smallholder tea plantations with guaranteed sorting and quality management so that they have a distinctive taste and aroma. nDeso tea has also received LESTARI standards which ensure that the practice of tea cultivation and processing takes into account social and environmental aspects based on sustainable principles.
“We provide a fair price for our farmers because they have carried out the cultivation process according to LESTARI standards. So that NDeso Tea helps maintain the existence of smallholder tea plantations and also provides the best quality tea for Indonesian consumers. nDeso tea is also one of the spearheads of people’s tea that helps and supports people’s tea plantations from upstream to downstream.” concluded Nanang Christianto.
The increasing interest of domestic consumers towards tea is now starting to be seen from the rise of cafes offering tea drinks and dishes which are favored by young people. Let us as Indonesian people participate in the transformation of the Indonesian tea sector and maximize this momentum, in order to maintain the sustainability of Indonesian tea so that it does not become extinct.
