Indonesia’s Ministry of Industry is preparing for a second program of support for upgrading machinery and equipment for downstream wood product manufacturers.
Putu Juli Ardika, the ministry’s Director-General of Agro-Industry, says the program has three main objectives: strengthening the value chain in the processed wood and furniture industry through technology optimisation, increasing production efficiency in the sectors, and enhancing industrial competitiveness by improving productivity and production quality.
He said the program’s implementation was based on Ministry of Industry Regulation Number 42 of 2022 and Ministry of Industry Regulation Number 31 of 2024. It involved providing discounts or reimbursement for the purchase of machinery and equipment. He noted that, as of August 27, 13 applications had been received through the National Industrial Information System.
In an International Tropical Timber Organisation report, Setia Diartathe, Director of the Forestry and Plantation Products Industry, said that as of 2022, 24 wood processing and furniture companies had participated in a program to upgrade their machinery and equipment.
According to reports from companies receiving funds, the program increased company efficiency by 10-30%, product quality by 10-30%, and company productivity by 20-30%.
Meanwhile, discussions have commenced between Indonesia’s raw and semi-finished rattan producers and advanced processing industries to seek ways to strengthen the country’s rattan industry.
Discussions have focused on strategic issues confronting the rattan processing industry, from raw material sourcing to finished product production.
The meeting also explored strategies for market creation and efficient management of the rattan supply chain.
Director of Indonesia’s Forest Product Processing and Marketing Management Ristianto Pribadi emphasised that rattan is abundant in Indonesia and is a sustainable non-timber forest product. Rattan product exports are significant for Indonesia, but exports have declined by more than 50% between 2021 and 2023.
Pribadi noted that the decline in exports negatively impacted raw and semi-finished rattan product producers.
Indonesia’s rattan processing industry also faces competition from other countries, including China, Vietnam, Malaysia, and the Philippines. Additionally, synthetic rattan products have posed challenges to Indonesia’s rattan marketing.
