While the eastern part of Indonesia is full of natural biodiversity and known for its fantastic marine life, there is more to give. West Papua in particular has vast biodiversity, including the natural forest and indigenous peoples. It gives a ton of local production commodities, such as nutmeg. But, how good is the prospect?
The Nutmeg Production
The Fak Fak Regency has a huge potential for its local Nutmeg production. In many cases, the family running a business in nutmeg is sold for around $3.50 for its beans and $15 for the flowers. It is equivalent to Rp 50,000 and Rp 205,000 per kg. That number shows the low value of nutmeg production. The value also falls behind many other spices.
However, around 86 percent of the FakFak is covered by natural forests where the Nutmeg is harvested. It is also found in most of the Kaimana regencies. Spice is one of the major sources of income for some local communities, such as Wermenu, Egarwara, Manggera, and Kufuryai villages. They have a 40–78 hectare plot of nutmeg cultivation.
The income estimation can reach up to 40-63 million rupiah per year. That is pretty high and considered as a huge economic growth in west Papua. However, there are many points in which the production is lacking due to the traditional yielding process. In Fakfak, the locals harvest the spice twice a year and sell it to informal traders.
Traditional and natural cultivation eventually limit the yield. Thus, it currently has a lower yield quantity and the quality is hardly consistent. All goes to the fact that local people are still using the harvest and postharvest practices. At some point, the supply and trade were also under the same HS code with Bandanese nutmeg. Thus, make the Papuan nutmeg lose value.
The Business Development Efforts
Why nutmeg? Papuan Nutmeg tends to be undervalued due to its inferior production. But, Indonesia has a relatively huge nutmeg export value with around 111.70 million USD in 2018. That number was 20.200 plus tons of export volume. And it is not a surprise that Cendrawasih island is one of the biggest suppliers of that commodity.
Not only that, west Papua can consider that nutmeg is one of the largest commodities in the province. The nutmeg production by 2020-2024 national Medium-term Development planning indicates development projects. It was part of the central government that targeted the increase of national nutmeg production to double in number by 2021.
1. Dutch Company investment
To realize the target, several investments might reach Papua in no time. One of them is a Dutch company that was announced by the BKPM leader on November 23th, 2021. It said that the company will develop around 40,000 hectares of plantation and cultivation in Fakfak and Kaimana.
The announcement also highlights the company’s willingness to work with the local nutmeg farmers. However, they would also provide technology that helps in the yielding and production process. It includes stripping, drying, and cleaning. The project also pinpoints the possibility to employ more than 50.000 local or Indonesian nutmeg farmers.
2. EcoNusa Foundation investment
Another investment prospect is by EcoNusa. The local potential and the huge production company make a detailed assessment of the four villages at Kaimana regency, West Papua. The project underlines that the farmer has to face many challenges to cultivate, yield, and trade the product.
Nutmeg is also considered a local currency. People also sold the product as a raw material that significantly decreased its price. From the assessment, the investor planned to develop efficient nutmeg marketing to bring a decent profit. It also includes a collaborative effort with locals under the Joined village-owned enterprise.
What Investor Need To Highlight
Before investors and investment in local nutmeg take apart, there are some issues that they should make a priority. The first one is the inferiority of the Papuan Nutmeg compared to Bandanese nutmeg. Since the two nutmegs go under the same market, many people do not know the difference that heavily affects the value.
It is especially true since the Papuan nutmeg has different chemical components that affect its fragrance and flavor. Other than that, the non-competitive local nutmeg has no proper terms and conditions. It means that the indigenous farmers have a vulnerability for the market, quantity, and quality supply.
So, the investor and the business development under this west Papua commodity should pay attention to local sovereignty. The highlights include improving the production of Papuan nutmeg, not the Bandenese. It also needs to acknowledge the local farmer’s land rights, establish indigenous producer organizations, and provide greater employment opportunities.
Considering how the local commodities are not limited to a certain degree, Papua has a lot to offer. The government needs to acknowledge many other commodities, aside from mining, palm oil, or marine products. That is why nutmeg production needs proper business developments that improve machines, supply transactions, and investment.
