Indonesia’s Sugar and Salt Self-Sufficiency Goals Face Structural Challenges

Indonesia is pushing forward with a policy to end the import of industrial salt and sugar within the next few years. Under President Prabowo Subianto’s goal of food self-sufficiency, the targets are set for sugar self-sufficiency for domestic consumption by 2028, industrial sugar by 2030, and industrial salt by 2027.

The Indonesian government plans to open over 2 million hectares of new sugarcane plantation areas in Papua and expand salt pan areas. Additionally, it has assigned the state-owned asset management fund, Danantara, to construct a salt processing plant with a production capacity of 380,000 tons per year.

However, agricultural experts from the Indonesian Association of Political Economy (AEPI) view these goals as being driven more by “ad-hoc projects” rather than addressing deep-seated structural issues, such as low agricultural productivity, weak regulatory coordination, and the underperformance of state-owned enterprises.

In the sugar sector, it has been pointed out that domestically produced cane sugar is allocated solely for household consumption and has no linkage to industrial sugar. Domestic refineries are designed to process imported raw sugar, leaving the industrial structure dependent on imports. Indonesia is the world’s largest importer of raw sugar, typically importing around 5 million tons per year; however, the government has capped the import quota this year at 3.12 million tons. This has resulted in some refineries temporarily halting production due to raw material shortages.

Regarding salt, although Indonesia has been self-sufficient in edible salt since 2012, the demand for industrial salt remains significantly higher than domestic production capacity.

Indonesia is pushing forward with its self-sufficiency policies for industrial salt and sugar but faces significant obstacles. Experts warn that the established targets may be unrealistic. Under President Prabowo Subianto’s policy, the goals are to achieve self-sufficiency in household sugar by 2028, industrial sugar by 2030, and industrial salt by 2027. However, structural issues and constraints regarding the efficiency of state-owned enterprises have yet to be tangibly addressed.