Minister of Industry Agus Reveals Two Challenges Faced by the Coconut Palm Industry

JAKARTA - Minister of Industry (Menperin) Agus Gumiwang Kartasasmita said that there are currently two challenges facing the cassava starch industry.

The two challenges are price competition and quality with imported products.

This was conveyed by Agus in his remarks at the Opening of the Pati Ubi Kayu Business Matching in Jakarta, Thursday, January 22.

"Although this sector has great potential in driving economic growth and strengthening the national industry, there are still a number of challenges that need to be overcome. These challenges include price and quality competition with imported products," said Agus in an official statement, Friday, January 23.

To overcome these challenges, said Agus, his party also encourages the strengthening of synergy between cassava starch producers and user industries, one of which is through the implementation of the commodity balance mechanism (NK).

"The domestic cassava starch industry is expected to diversify the specifications required by the user industry," he said.

The business matching program held by the Ministry of Industry is part of efforts to expand the domestic cassava starch market, import substitution, diversification of cassava starch specifications, and strengthening the supply chain of the cassava processing industry.

The business matching was attended by 17 cassava starch industries located in Lampung Province.

The program was also attended by 51 prospective buyers, consisting of two industry associations and 49 cassava user industries in the food and non-food sectors.

In terms of territory, Lampung is the main center of cassava starch industry.

Lampung Governor Rahmat Mirzani Djausal revealed that currently Lampung Province has more than 60 tapioca processing plants, with a total installed capacity of 21 million tons of cassava per year.

With an average conversion ratio of about 5 kilograms (kg) of cassava to 1 kg of tapioca, Lampung has the potential to produce more than 4.2 million tons of tapioca flour per year to meet the needs of the national industry.

"Through this business matching, we hope that it will give birth to real commitments, long-term partnerships and accelerate national economic growth," he said.

To note, currently there are 125 cassava starch companies in Indonesia with an utilization rate of 43 percent.

A total of 91 companies are classified as small and medium industries, while 34 companies are classified as large industries.

Currently, domestic cassava starch dominates 79 percent of the domestic market.

Until November 2025, cassava starch exports reached 47,500 tons or worth 18.7 million US dollars, up 58.34 percent compared to the previous year.

On the other hand, Indonesia still imports 189,800 tons of cassava starch or worth 73.8 million US dollars.

The value of cassava imports until November 2025 decreased by 54.59 percent compared to the previous year.