Jakarta — The government, along with industry players, is promoting the downstreaming of wood and rattan as a strategy to increase added value, expand export markets, and create sustainable jobs. By strengthening the supply chain from upstream to downstream, from raw material legality and design to production and global marketing, Indonesia is targeting a surge in exports of high-value furniture, crafts, and interior components in the next few years.
Downstreaming efforts are focused on transforming raw commodities into superior-designed finished and semi-finished products. The main focus includes developing original designs, standardizing quality, sustainable certification, and adopting precision manufacturing technology. This will ensure that Indonesian wood and rattan are recognized not only as raw materials but also as finished products that meet global trends such as eco-design, modularity, and the circular economy.
Indra Explotasia, Head of the Extension and Human Resources Development Agency at the Ministry of Forestry, stated that many fledgling Forest Farmer Groups (KTH) still face obstacles due to the lack of downstreaming. Therefore, the Ministry of Forestry emphasizes that downstreaming forest products can increase the added value of KTH and simultaneously strengthen the national economy.
“Rattan is sold raw, not finished goods. Downstream processing is needed to add value to the product, and this can be achieved through various collaborative measures,” said Indra.
Ellen Esther Pelealu, a member of Commission IV of the Indonesian House of Representatives (DPR RI), stated that Central Sulawesi Province successfully recorded a KTH economic transaction value of IDR 20.07 billion, exceeding the target of IDR 18.5 billion or 110 percent.
“This IDR 20 billion achievement is extraordinary and should serve as motivation to continue driving the community economy in the forestry sector,” Ellen said.
On the upstream side, strengthening community forest governance, partnerships with cooperatives, and access to phased financing for MSMEs are key to ensuring a legal, sustainable, and stable supply. Meanwhile, on the downstream side, the government and industry associations are accelerating programs to improve design competency, digitize production processes, and integrate cross-border e-commerce, including participation in international trade exhibitions.
The industry is targeting expansion into non-traditional markets such as the Middle East, Africa, and South Asia, while maintaining core markets in North America, Europe, and East Asia. Differentiation is achieved through storytelling about natural Indonesian materials, a low carbon footprint, and the excellence of artistic handcraftsmanship. Legality and sustainability certifications are also positioned as selling points, addressing the preferences of global consumers who are increasingly concerned about environmental and social aspects.
The downstream processing of wood and rattan not only increases export value but also fosters a creative ecosystem, absorbs local labor, and strengthens Indonesia’s image as a world-class hub for natural products. With collaboration between the government, industry, MSMEs, and academia, Indonesia is poised to pave the way for exporting high-value, competitive, and sustainable products.
