Indonesia and Thailand have an opportunity to strengthen agricultural cooperation following a meeting between Indonesian President Prabowo Subianto and Thai Prime Minister Paetongtarn Shinawatra. According to Devi Erna Rachmawati, Vice Chair for Agriculture at the Indonesian Chamber of Commerce and Industry (Kadin Indonesia), the meeting could open a new framework for economic cooperation, especially in agriculture. (19/12)

Devi said food security has become a strategic issue because of climate change, food supply chain disruptions, geopolitical tensions, and commodity price fluctuations. Countries that can secure food supplies will have stronger economic resilience.

Indonesia and Thailand Have Complementary Strengths

According to the article, Indonesia and Thailand have significant potential to become a major agricultural growth center in ASEAN because both countries have complementary advantages.

Indonesia has large agricultural land, rich tropical biodiversity, a productive workforce, and the largest domestic market in Southeast Asia. Thailand is recognized as one of the world's largest agricultural exporters, supported by cultivation technology, food processing industries, quality standards, and established global distribution networks.

The article states that future cooperation should move beyond primary commodity trade toward value creation, downstream industries, technological innovation, joint investment, and stronger regional food supply chains.

Agricultural Trade Continues to Grow

Agricultural trade between Indonesia and Thailand reached approximately US$4.15 billion in 2023. Indonesia exported around US$2.32 billion, while imports from Thailand totaled about US$1.83 billion.

During the past five years, bilateral agricultural trade grew by an average of 6.3% annually. The article says this growth shows healthy economic relations and considerable room for further expansion.

Indonesia exports palm oil and its derivatives, rubber, tropical fruits, coffee, spices, and fisheries products. Thailand exports corn, sugar, animal feed, horticultural products, agricultural machinery, and agricultural technology.

The article states that this trade structure shows the two countries complement each other rather than replace each other. It also says the next opportunity lies in investment partnerships and innovation.

Technology, Downstream Industries, and Research Are Priority Areas

The article says Indonesia needs to accelerate its transition toward technology-based modern agriculture. Thailand has experience in precision agriculture, smart farming, mechanization, and digital food supply chains.

The cooperation is expected to support technology transfer and improve farmers' productivity.

The article also highlights downstream development for strategic commodities, including palm oil, rubber, cocoa, coffee, cassava, sugarcane, tropical fruits, and horticultural products. Through downstream industries, Indonesia could produce more value-added processed products instead of exporting raw materials.

In research, Indonesia and Thailand could build partnerships involving universities, research institutions, businesses, and governments. The cooperation could focus on superior seeds, agricultural biotechnology, modern mechanization, and low-carbon agricultural technology.

Investment opportunities include food industrial estates, cold chain logistics, regional distribution centers, and agricultural processing industries.

Fertilizer Exports Present a Business Opportunity

The article identifies fertilizer exports as one opportunity for Indonesia.

Thailand's fertilizer market was valued at approximately US$1.04 billion in 2023, with imports totaling around 4.7 million tons. Most supplies currently come from China, Malaysia, Saudi Arabia, and other countries.

According to the article, Indonesia has the opportunity to increase its market share by supplying competitive, high-quality chemical and organic fertilizers produced through sustainable methods.

Indonesia-Thailand Agricultural Partnership Proposed

Kadin Indonesia's Agriculture Division proposes establishing an Indonesia-Thailand Agricultural Partnership involving governments, businesses, universities, research institutions, and the private sector.

According to the article, the partnership could support trade, investment, innovation, education, technology, and agricultural human resource development.

The article sets targets to increase bilateral agricultural trade to US$6 billion within five years, encourage Thai agricultural investment in Indonesia to reach US$1 billion, expand technology transfer, strengthen regional food security, and improve farmers' welfare in both countries.

The article also states that Indonesia and Thailand could become the driving force behind a modern, resilient, and sustainable ASEAN agribusiness ecosystem by integrating their respective strengths.

PHOTO: FREEPIK

This article was created with AI assistance.

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