Sunday, October 26, 2008

Dozens of North Sumatra Coffee Exporters are threatened bankruptcy

Mature fruit of a Coffea speciesDecreasing of the horticulture commodities' price in the international market in line with the global financial crisis to make tens of coffee exporters in the North Sumatra threatened gone out of business. The price of arabica coffee, which is a mainstay of export of North Sumatra is fall dramatic since last month

According to the Chairman of the Indonesian Coffee Exporters Association (AEKI), North Sumatra (North Sumatra) Suyanto Hussain, the price of Arabica coffee in the international market in a last month fall from US$ 3,800 per ton to be US$ 3,200 U.S. per ton. "The decline is still not over yet. Most likely price in the international market will fall again, due to global economy crisis still has not recovered," said Suyanto in Medan, on Tuesday (21/10).

He discloses, the loss exporters of coffee in North Sumatra triggered mainly because of the purchase coffee from farmers have done well before the financial crisis occurred. "We're buy coffee from farmers long before the crisis. If all of these stocks have sold should be no problem. But there still a lot of coffee that has not been sold. Purchase price from farmers when it is high enough, while the current selling price to our export markets have declined drastically, "He said.

The losses because exporters are not able to cover the difference between buying price from farmers with the selling price to the export market. Moreover, the main market of North Sumatra Arabica coffee is U.S., Japan and Europe, which most of theses countries affected by the global financial crisis most.

"In the last three years, more than two-thirds of North Sumatra Arabica coffee is export to the United States and Europe. The largest purchaser of North Sumatra's Arabica coffee in international outlets such as Starbucks. There is also export to Japan, but Japan's have also affected the global crisis," Suyanto said.

Suyanto said, from the 400 coffee exporters in North Sumatra, which registered in AEKI, currently only 60 exporters which is still active. "That is the amount of the active, they are threatened now gone out of business because of this crisis," he said.

According to Suyanto crisis in the countries of the North Sumatra's arabica coffee market has made consumers in these countries are to change the style to consume coffee. "People used to enjoy coffee at Starbucks outlets , now they prefer to buy coffee in the packaging. Far better to save expenditure, especially coffee is not a major need," he said.

Government is required to make a buffer agency for the commodities that have become the mainstay of Indonesia's income, such as coffee, rubber and palm oil. "Indeed, there must be a trading system so that farmers are not disadvantaged in a condition that the price continuously declined as now. There are a benchmark price which the government can prosecute certain commodities in the international market when prices fall. We may not be fully mechanism to the free market price is met speculator . Moreover, this is the speculator who now make a crisis occurs, "he said.

According to AEKI record, in September 2008 the export value of North Sumatra's coffee has reached 10.4 million U.S. dollars, with details of the volume, Arabica coffee exports reached 2,575 tons, 341.44 tons of robusta coffee, and coffee in the form of packages reached 138.9 tons.