Indonesia Identifies Key Opportunity to Boost Pepper Exports to Japan
The Indonesian Ministry of Agriculture (MoA) has identified a strong and promising potential to significantly increase exports of both white and black pepper to the Japanese market.
This export drive is primarily fueled by the country’s high and consistent consumption of pepper-based foods, a cultural preference that creates a reliable market.
Kuntoro Boga Andri, the Director of Plantation Product Downstreaming at the MoA, highlighted that Japanese consumers show a remarkable demand for pepper, largely because much of their traditional cuisine relies heavily on key spices, including pepper, salt, and nutmeg.
This substantial market size presents a valuable opportunity for Indonesia to boost exports, specifically targeting white pepper from the Bangka Belitung Islands and black pepper from Lampung.
However, this export potential is currently being constrained by domestic production challenges.
Kuntoro noted a crucial imbalance where the rising global demand for pepper has not been adequately matched by a corresponding increase in domestic output.
Indonesia’s pepper productivity has regrettably declined in recent years, a trend directly linked to the shrinking size of pepper plantations across the country.
This situation poses a serious concern for the government, which is actively working to implement strategies to restore the country’s once-dominant pepper industry to its former strength and address increasing competition from other major global producers, particularly Vietnam, India, and Pakistan.
The Challenge of Declining Domestic Pepper Production
Data compiled by the Ministry of Agriculture clearly illustrates the downward trajectory of Indonesia’s domestic pepper production over the last few years, highlighting the scale of the challenge the industry faces.
The country’s total pepper production has fallen consistently, dropping from a significant 83,915 tons recorded in 2019 to just 63,461 tons in 2025.
This steep decline has become a central concern for agricultural policymakers who view the revitalization of the pepper sector as an economic priority.
The core issue lies not with demand—as the Japanese market opportunity clearly indicates—but with the supply-side constraints, primarily the reduced acreage dedicated to pepper cultivation and potentially lowered yields per hectare due to aging farms or insufficient investment in modern farming techniques.
Erwin Krisnawinata, the Acting Head of the Agriculture and Food Security Office of Bangka Belitung Islands Province, emphasized the irony in the current situation.
He proudly noted that the region’s white pepper is globally renowned for its distinctive flavor profile and strong spiciness, qualities that make it highly appealing and competitive in international markets.
Despite these superior characteristics and the benefit of strong global prices coupled with steady demand over recent years, Erwin revealed a paradox: many local farmers are choosing to abandon their valuable pepper farms.
This decision, often driven by labor issues, fluctuating immediate returns, or lack of technological support, compounds the national production deficit.
Strategic Necessity for Farmer Engagement and Export Sustainability
The abandonment of pepper farms by local growers, despite favorable market conditions and the premium value of Indonesian pepper, underscores the urgent need for a concrete and multi-faceted intervention strategy.
Erwin stressed that the government must devise effective measures to successfully reignite farmers’ interest in pepper cultivation and ensure the long-term sustainability of exports to high-value markets such as Japan.
This strategy must go beyond mere price signals and address the structural issues impacting farmers’ decisions.
Key areas for intervention include providing specialized assistance for replanting and modernizing older pepper plantations, offering incentives that make pepper farming financially more attractive and less labor-intensive, and improving the supply chain infrastructure from the farm gate to the port.
Without such proactive governmental and industry support, the valuable market opportunity in Japan and the premium pricing commanded by pepper varieties like Muntok White Pepper will be increasingly captured by competitors.
Restoring Indonesia’s production levels to previous heights, and eventually surpassing them, is crucial not only for capitalizing on this export potential but also for maintaining Indonesia’s historical influence within the global pepper trade.
The focus must be on creating a sustainable and profitable farming ecosystem that recognizes the global value of Indonesian spices and encourages a new generation of farmers to commit to pepper cultivation for the long term.
Economy and Commodity Impact: Recapturing Premium Niche Market Share
The identified export opportunity to Japan—a market with stringent quality controls and a willingness to pay a premium for specific flavor profiles—holds significant economic potential that transcends the volume metric.
Indonesia’s white pepper, particularly the Muntok White Pepper from Bangka Belitung, commands a price premium in specialty markets due to its unique terpene profile (like pinene and limonene), which distinguishes it from the more volume-focused black pepper from competitors like Vietnam.
The decline in Indonesian production from 83,915 tons to 63,461 tons between 2019 and 2025 represents not only a 24% volume loss but also a significant forfeiture of market share in the high-value niche segment.
From a Business and Finance perspective, revitalizing the pepper industry requires a shift from a subsidy model to an agri-finance and technology adoption model.
The current trend of farmer abandonment, despite strong global prices, points to a fundamental problem with the cost-to-labor ratio and the long gestation period of pepper vines.
To successfully penetrate the Japanese market and sustain exports, the government must incentivize farm-level technological upgrades, such as efficient irrigation and better post-harvest processing (e.g., controlled fermentation for white pepper quality), thereby enhancing the price realization.
Successfully leveraging this opportunity would not only boost Indonesia’s non-oil and gas export revenue but would also strengthen the Terms of Trade for smallholder farmers in regions like Bangka Belitung and Lampung, providing a sustainable income floor and contributing to regional economic stabilization against commodity price volatility.
The failure to address the supply side will result in Vietnam and other producers capitalizing on the volume demand, while Indonesia risks losing its status even in the premium white pepper niche.
