Indonesia’s ambition to move up the global chocolate value chain continues to face persistent challenges across the cacao supply chain, from low farm productivity and inconsistent bean quality to weak branding and export competitiveness. Industry players say problems begin upstream. I Kadek Surya Prasetya Wiguna, CEO of Bali-based chocolate producer Cau Chocolates, said plant diseases and high capital costs for seeds and fertilizer continue to suppress yields.
“At the intermediary level, many processing factories still accept unfermented cacao beans,” Kadek told reporters at a media briefing in Bali on Nov. 25, noting that the practice violates a Ministry of Agriculture regulation requiring factories to process only fermented beans.
Cacao beans typically require six to 10 days of fermentation to prevent mold and pathogens, followed by five to 10 days of drying to stabilize flavor, before being roasted and processed into intermediate products such as cocoa butter and powder. Indonesian Cacao Council (Dekaindo) chairman Soetanto Abdoellah said farmers often skip fermentation because it takes time and offers little financial incentive. More importantly, a market still exists for unfermented beans, as some producers blend fermented and unfermented beans in a 60:40 ratio to cut costs without significantly affecting taste.
“As long as farmers produce unfermented beans, Indonesia will continue to be seen as a low-quality producer,” Kadek said, adding that Indonesia is the only major cacao-producing country that tolerates the practice.
Indonesia was the world’s third-largest cacao bean producer between 2005 and 2015 but slipped to seventh place by 2019, though it remains Asia’s largest producer. The country has 1.3 million hectares of cacao plantations, almost entirely managed by smallholders. In 2024, most of the roughly 200,000 tonnes of beans produced were absorbed by domestic processors, with only about 13,000 tonnes exported, according to Statistics Indonesia (BPS).
An export duty imposed since 2010 has encouraged domestic processing. Indonesia became a net exporter of cacao products in 2024 due to strong shipments of cocoa paste, butter and powder. However, the country still recorded a trade deficit in finished chocolate, exporting around 25,000 tonnes while importing 24,000 tonnes, resulting in net imports worth $51 million. Despite its production base, Indonesia imported 157,000 tonnes of cacao beans last year to meet domestic demand.
Adi Sucipto of the Plantation Fund Management Agency (BPDP) said 10 of Indonesia’s 31 chocolate factories had closed because import costs exceeded profits. Global cacao prices surged throughout 2024 and early 2025 following harvest failures in West Africa, worsening supply pressures. Low productivity remains a core issue. Many plantations yield only about 600 kilograms per hectare annually, far below the ideal 2 tonnes, Kadek said. Finance Ministry official Nurlaidi added that two-thirds of Indonesia’s cacao trees are too old to be productive, while Bali official Dewa Ayu Nyoman Budiasih noted that the farmer population is also aging. Farmers struggle with thin margins and limited access to processors. Cau Chocolates offers a minimum price of IDR 100,000 ($5.99) per kilogram for fermented beans, shielding farmers from price swings. The company exports about 10 percent of its output, mainly to Poland and Australia.
On the downstream end, the industry faces consumer preference gaps and branding challenges. Indonesians tend to favor sweeter chocolate, while domestic producers focus on darker varieties, contributing to high imports. Kadek said reshaping perceptions is crucial. “We grow the cacao, yet the best-known chocolate comes from elsewhere,” he said.
December 6, 2025, The Jakarta Post(https://www.thejakartapost.com/business/2025/12/06/why-cacao-rich-indonesia-is-not-yet-a-global-chocolate-producer.html)