For centuries, Indonesia has been widely known for its vast natural resources including a wide variety of plants and vegetation. Many agricultural and forestry products have been cultivated either for raw materials or further processed. Only in the past 40 years or so has the essential oil refining industry started to develop. The modernization of agri-business and agro-industry has been slow leading to variations in the quality of cultivation and harvests, as well as inefficient processing plants and distillation techniques. Farmers’ and distillers’ limited access to working capital and modern trade mechanisms has spurred the emergence of middlemen who often add layers and complexity to the supply chain. These inefficiencies are not conducive to the growth of the Indonesian essential oil industry and diminish its global competitiveness.
On the demand side, the flavor, fragrance and pharmaceutical industries - which are the largest purchasers and users of essential oils - require continuous supplies of essential oil products that meet certain quality standards and at reasonable price levels which ensure sustainable use of the products. Additionally they are always in search of new, unique, improved and better performing products that could help them meet the ever-rising standards demanded by the market.
Faced with the above concerns, and following various meetings, the Dewan Atsiri Indonesia (DAI) / the Indonesian Essential Oil Council (IEOC) were established on May 3rd, 2007 with the VISION of “Indonesia as the essential oil center of excellence in the world”.
The MISSION is :
- Uniting all essential oil stakeholders in Indonesia and to protect and stand up for their best interests in the global market.
- Increasing the competitiveness of Indonesian essential oil products.
- Encouraging the development of essential oil products in Indonesia.
- Establishing cooperation with foreign counterparts to assist the development of the domestic essential oil industry.
The STAKEHOLDERS are :
- Producers (Farmers’ Associations, Distiller Associations, User-industry Association)
- Traders (Collector Association, Export and Trader Associations)
- Government Institutions (Ministry of Industry, Ministry of Agriculture, Ministry of Trade, Ministry of Cooperative)
- Research Institutions (IPB, UNPAD, ITS, UGM, ITB, BPPT, LIPI)
- Financial Institutions (Banks, NBFI, Venture Capital)
DAI’s main task is to champion inter-disciplinary and inter-departmental initiatives to reform the Indonesian essential oil industry. Internally, the DAI aim to develop a framework within which the essential oil industry can achieve sustainable development. The focus of DAI programs is on the provision of training and advocacy to farmers, distillers, and traders to improve their knowledge and skill bases in producing quality crops and essential oils that meet international standards. Clustering approaches are used to encourage product excellence. The ultimate objective is to ensure continuity in the supply of standardized quality products at the most economical costs to meet market demands while ensuring sustainable economic development for all stakeholders.
Externally, the DAI actively promote Indonesian essential oils in the world market. Surveys are conducted and trends monitored to provide the basis for new product developments. The Council also engages in discussions with overseas buyers to better understand their needs and requirements. It works with international regulatory bodies and other parties to ensure that Indonesian essential oil products meet the current regulatory challenges.
Since its formation, the DAI has received full support from Government Ministries, and academic and research institutions engaged in agriculture, horticulture, and forestry. Other stakeholders including provincial governments, distillers, manufacturers, and traders/exporters involved in essential oils have pledged to assist in implementing DAI’s programs. The DAI Board reflects these commitments, being comprised of representatives of all the stakeholders including one from the Indonesian Flavor and Fragrance Association as a user-industry.
To sum up, the DAI/IOEC nurtures a spirit of partnership to achieve the common objectives and will actively seek the trust and cooperation of all stakeholders. Transparency is upheld by providing access to information for all, allowing fair play and a level playing field for entrepreneurship to flourish. Ultimately, a WIN – WIN situation for all should be achieved.