Update COVID-19 in Indonesia: 24,538 confirmed infections, 1,496 deaths (28 May 2020)
29 May 2020 (closed)
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Indonesia's tobacco production is expected to rebound to 182,000 tons in 2016 according to the Indonesian Tobacco Farmers Association (APTI), up 7 percent from an estimated 170,000 tons this year. Higher tobacco production is needed as the country's cigarette manufacturers are producing more and more cigarettes each year. With Indonesia's tobacco industry requiring about 300,000 tons per year, the industry remains dependent on tobacco imports. Indonesia is the world’s third-largest tobacco consumer (after China and India) with about 60 million Indonesians - aged over ten years - being categorized as smoker.
Data from APTI indicates that there are currently 192,525 hectares of tobacco plantations in Indonesia. As such, the size of the country's tobacco plantations has declined drastically over the past years. APTI said that several years ago, there were still 260,000 hectares of tobacco plantations in Indonesia as some farmers have turned to palm oil. This year, the average tobacco price ranges between IDR 34,000 and IDR 47,000 per kilogram, making the tobacco plantation business less appealing. The APTI comments that a good price for tobacco farmers would be in the range of IDR 80,000 and IDR 120,000 per kilogram.
However, tobacco imports (mostly from China) are much cheaper at around IDR 14,000 per kilogram than domestically-produced tobacco, implying that imports are a much more attractive option for the country's cigarette producers.
Indonesia's Industry Ministry said cigarette consumption in Indonesia increases by about 5-7 percent each year. In 2015 the Ministry expects that the country's cigarette manufacturers will produce a total of 398.6 billion cigarettes. By 2020, cigarette production is estimated to rise to 524 billion cigarettes. There are currently around 700 cigarette manufacturers registered in Indonesia. However, only 200 to 300 of these companies are active.
Indonesia's Tobacco Production & Import 2010-2015
There are four tobacco companies listed on the Indonesia Stock Exchange (IDX):
Gudang Garam and HM Sampoerna are among the countries largest companies in terms of market capitalization on the IDX.