Sambu Group has its 50th anniversary this year – Has your business always been coconuts?
The focus of the group has always been on coconuts. With the Sumatran geography it is natural that we trade in Coconuts or copra but we are also growing pineapples, which was first used as an intermediary crop during the nine years coconuts need to reach maturity. We’re now diversifying further; Indonesia has been importing a lot of commodities which it can grow itself. If we can supply these commodities domestically, this will be more beneficial than importing them.
Please expand a little on your community/plantation, we understand everything is organized through barges which use waterways?
Our land is not accessible by land, only by water. The factory is located in lowland, wetland and swampland, and a lot of the surface is covered by peat, clay and mud. Such a location requires you to be self-sufficient: each of our locations for instance has its own power plant.
Such engineering expertise took us decades of trial-and-error and it’s truly niche expertise. This concept would work very well here in Indonesia and the northern territories of Australia.
This has helped us establish plantations where you normally cannot. In the old days, it was agreed that cultivating such land was too costly and too difficult. About 50-60% of the costs would be required for the foundation but our expertise enables us to build our industry in this area.
How is it with your produce, how do you balance the production of the different coconut products?
It’s not always about the profit, but about how we can sustain coconut farmers in the long term. The raw material is owned mainly by the farmers and not by the plantation, therefore, we have to incentivise the farmers to continue cultivation, even if this means sacrificing short-term economic gain.
You export to five continents and 150 countries, which is very impressive, but doesn’t this also mean you need to focus your attention on certain areas for better growth?
It is difficult as we process everything. Not all product lines will have the same market growth or value: not only will you have to balance between the different areas, but also between the different products. But this balance is what differentiates us from others. Our willingness to not only focus on short term economic benefit, but a long term growth model.
I would also like to focus a little more on your community – especially also what you mentioned in the beginning: its philosophy of sustainability
I think the industry as a whole should be doing more of this. Otherwise inequality will increase, you get unhappy farmers, which will in turn reflect on the companies and industries. We also believe consumers are beginning to value this more and more. The emergence of food activists or ‘conscious consumers’, is notable.
Even your electricity can be considered carbon neutral, as what you are burning is the result of trees grown in our lifetime. How about fair trade certificates?
For us, it’s not about getting certificates to earn a higher margin, our concept is necessary for our survival. If we do not ensure that farmers and local communities feel that our presence is beneficial, we will not survive in the long run. But we are currently seeing another threat; the flight of farmers from the community to the cities.
So who will be the coconut farmer of the future?
Coconut is not like maize or wheat, where mechanisation is possible. Every coconut is different, hence the coconut industry is a very labour intensive industry. We have to create an attractive future, which is why we are talking about reforming the whole ecosystem. We have a roadmap, but it’s a long term game. The approach has to be more than solely taking into account economic incentives and be more humanistic. We can develop the local economy, creating an incentive to stay, which becomes an acceptable alternative to urbanization. Our model is highly social and can only work if we keep it that way.