2020, Volume 23, Paper 3

ISSN: 2209-6612

The Madura Island Salt Value Chain

Kurnia Trisno Yudhonegoro

Abstract

Indonesia as the largest archipelagic nation in the world has many potential growth industries in terms of maritime products, including seawater salt. In the last four years, the Indonesia salt production balance has been consistently in deficit, and a record deficit in 2016 reached 3.2 million tonnes. Indonesian seawater salt production occurs across 51 regions, by mostly small scale operators, which complicates industry value chain analyses. Madura Island is the largest salt production region in Indonesia. It is used as a case study to inform the general constraints that hamper the salt industry’s growth and competitiveness. This case study also suggests some potential industry improvements. Constraints were found in production, value-adding, feedback mechanisms, governance and regulation. Strategies to address identified constraints to enable a better growth path for Madura Island’s salt industry are in the final sections of the paper.

Keywords: Salt, value chain, Indonesia, deficit, small scale operators

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