Impact of COVID-19 epidemic hits Indonesia’s small seaweed processors

Impact of COVID-19 epidemic hits Indonesia’s small seaweed processors

5 May 2020 – In late April, more than 60 members of Indonesia’s Tropical Seaweed Innovation Network (TSIN) held a virtual consultation on the state of the seaweed industry in relation to the COVID-19 epidemic.

The meeting was organized by Global Quality and Standards Programme, a strategic partnership between United Nations Industrial Development Organization (UNIDO) and the Government of Switzerland to promote trade and competitiveness through strengthening the quality and standards compliance capacity of small and medium enterprises (SMEs) in eight countries.

The Indonesia TSIN virtual consultation was initiated by Artati Widiarti, Advisor to the Minister of Marine Affairs and Fisheries, and Andri Wahyono, Assistant to the Deputy Minister of Coordinating Ministry of Maritime Affairs and Investment. Participants included representatives of various ministries, universities and research and development institutions and seaweed associations who were joined representatives of international organizations such as the Swiss Import Promotion Programme (SIPPO) and the Dutch Centre for the Promotion of Imports (CBI).

The COVID-19 epidemic has directly affected seaweed farmers as demand for raw materials has decreased and prices have fallen. The price of mainly exported Cottonii seaweed, used for producing carrageenan (an additive used to thicken, emulsify, and preserve foods and drinks), has declined by almost 50% since trade with China, the biggest export market, has been disrupted since February.

Participants explained how the impact of the epidemic on Indonesia’s seaweed processing industry varies depending on the size of enterprise and type of product they sell. Professor Jana Anggadiredja, the GQSP’s national seaweed expert, said many carrageenan processors have stopped operations since the end of March because of a sharp drop in demand from overseas markets. Whereas large agar processors are still able to maintain three shift operations, as long as raw materials are available, weakening demand on the domestic and export markets has forced smaller processors to cease operations. Home-based micro enterprises, mainly led by women and which produce seaweed-based food and drinks, are suffering particularly from declining sales.  

However, according to Donny Nagasan, chairman of ASTRULI (the Seaweed Industry Association of Indonesia), the spike in medical testing around the world has created an opportunity for the industry to offer new products, such as high-bacto agar from Gracillaria, which serves as laboratory medium for COVID-19 testing.

The TSIN is composed of 27 public and private R&D centres under different ministries and universities, over 150 experts and more than 49 industry enterprises. The Network aims to increase effectiveness of investments in R&D by fostering collaboration among research and academic institutions under a global strategy and to promote market-driven R&D by engaging industry more actively in the innovation process. TSIN is the result of a technical assistance programme (SMART-Fish) funded by the Swiss Government and jointly implemented by Indonesia’s Ministry of Maritime Affairs and Investment and UNIDO.

For more information, please contact:

Steffen Kaeser

Chief, UNIDO Standards and Quality Infrastructure Division

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