Presentation to the International Conference on Root and Tuber Crops for Food Security - Malang, October 2017

1. Prospects, Challenges, and Opportunity
for cassava in a global market
Jonathan Newby
j.newby@cigar.org
Malang, Indonesia
10-11th October 2017

2. 0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
1961
1964
1967
1970
1973
1976
1979
1982
1985
1988
1991
1994
1997
2000
2003
2006
2009
2012
2015
CassavaArea(Millionha)
Indonesia Philippines Thailand Viet Nam
Cambodia Lao PDR Myanmar Other
Indonesia: formerly the largest cultivation of cassava in Asia

3. The most diverse utilization of cassava in Asia

4. Markets outlook for cassava needs to be considered in
the context of substitutes in different applications
1. Cassava for direct consumption or sale into short
value chains as fresh roots or gaplek. Competition
with other purchased food such as rice.
2. Global markets where cassava chips compete with
other forms of carbohydrate for processing animal
feed or ethanol such as maize, sorghum, wheat -
oil.
3. Markets where cassava starch competes largely
only price with substitutes such as maize and
potato starch, sugarcane.
4. Markets where the functional properties of the
starch are desired.

5. 0
50
100
150
200
250
300 Congo
Mozambique
Ghana
Angola
Madagascar
Paraguay
CentralAfricanRepublic
Liberia
SierraLeone
Nigeria
Togo
Benin
Côted'Ivoire
Cameroon
Rwanda
Guinea
Malawi
Uganda
Tanzania
Gabon
Zambia
Indonesia
Fiji
Colombia
Brazil
LaoPDR
Peru
Haiti
Cambodia
Cuba
Kenya
Philippines
Timor-Leste
Chad
Bolivia
Zimbabwe
DominicanRepublic
Guinea-Bissau
Thailand
Venezuela
Nicaragua
Myanmar
SriLanka
FrenchPolynesia
Senegal
Suriname
Niger
VietNam
CaboVerde
BruneiDarussalam
Kg/capita/year
Indonesia: highest per capita consumption in Asia

6. Rising incomes in Asia: changing diets and consumption
0
2000
4000
6000
8000
10000
12000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
GDPpercapita(constant2010US$)
World
Malaysia
East Asia & Pacific (excluding high income)
China
Thailand
Indonesia
Philippines
India
Vietnam
Lao PDR
Myanmar
Cambodia

7. 0
2
4
6
8
10
12
14
16
(KG/CAPITA/YR)
Pigmeat Mutton & Goat Meat Bovine Meat Poultry Meat
0
2
4
6
8
10
12
14
16
18
(KG/CAPITA/YR)
Demand for animal feed and sweeteners in Indonesia
Consumption of meat per capita Consumption of sugar per capita (Raw Equivalent)

8. 0.5
0.7
0.9
1.1
1.3
1.5
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
Areaofcultivationn(millionha)
Cassava
Cassava
National area of cassava and maize in Indonesia
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
Areaofcultivationn(millionha)
Maize
Maize

9. Indonesian imports of maize, maize starch and
cassava starch
0
50
100
150
200
250
300
350
400
450
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Tradevalue(millionUSD)
Maize starch
Cassava starch
0
200
400
600
800
1000
1200
Inportvalue(millionUSD)
Import of maize Import of starch

10. Trade in syrups and sweeteners (Indonesia)
0
20
40
60
80
100
120
Export
Import
Export
Import
Export
Import
Export
Import
Export
Import
Export
Import
Export
Import
Export
Import
Export
Import
Export
Import
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Tradevalue(millionUSD)
D-glucitol (sorbitol)
Fructose, syrup > 50% fructose, not pure fructose
Fructose, chemically pure
Glucose including syrup of 20%-50% dry weight
fructose
Glucose, glucose syrup < 20% fructose

11. Logistics and freight cost are important
$30MT
$15-20/t +
$10-20 truck and clearance

12. Market distortions, global commodities, local prices
-300
-200
-100
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100
200
300
400
500
600
Jun-08
Sep-08
Dec-08
Mar-09
Jun-09
Sep-09
Dec-09
Mar-10
Jun-10
Sep-10
Dec-10
Mar-11
Jun-11
Sep-11
Dec-11
Mar-12
Jun-12
Sep-12
Dec-12
Mar-13
Jun-13
Sep-13
Dec-13
Mar-14
Jun-14
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Dec-15
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
USDPERMT
Difference US Gulf Maize (FOB) US Gulf Maize CNF China + VAT Chinese Futures (DCE)
Rabobank estimated that there
was 232 million tons of Chinese
maize stock in 2015/16Floor price

13. 40
50
60
70
80
90
100
110
120
300
350
400
450
500
550
600
650
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
May-14
Sep-14
Jan-15
May-15
Sep-15
Jan-16
May-16
Sep-16
Jan-17
May-17
CassavaChips-FOBBangkok(USD/t)
Starch-FOBBangkok(USD/t)
Tapioca Starch Roots USD/t (25%)
Cassava prices in Thailand respond to changing
maize policy in China

14. Cassava market in Indonesia is connected to the
world price
200
250
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400
450
500
550
600
650
20
40
60
80
100
120
140
Oct-09
Mar-10
Aug-10
Jan-11
Jun-11
Nov-11
Apr-12
Sep-12
Feb-13
Jul-13
Dec-13
May-14
Oct-14
Mar-15
Aug-15
Jan-16
Jun-16
Nov-16
Apr-17
Starch(FOBBangkokUSD/t)
Rootprice(USD/t)
Lampung Roots ($US/MT) Thai Roots ($US/MT)
Thai Starch (FOB Bangkok)

15. 0
20
40
60
80
100
120
140
Oct-09
Jun-10
Feb-11
Oct-11
Jun-12
Feb-13
Oct-13
Jun-14
Feb-15
Oct-15
Jun-16
Cassavaroot(USD/t)
Cassava root price
(Jan 2017)
Location Price USD/t
(factory/collect point)
Starch content
Thailand $49 USD/T 25%
Tay Ninh (Vietnam) $74 – 77 USD/T 30%
Central Highlands
(Vietnam)
$64-65 USD/T 30%
Sonla (Vietnam) $58 – 60 USD/T 30%
North Sumatra
(Indonesia)
$47 USD/T 10 month min.
Bolikhamxai (Laos) $37 USD/T
Champasak (Laos) $37 USD/T
Xayabouli (Laos) $36 – 49 USD/T
Tboung Khmun
(Cambodia)
49-52 USD/T
Battambang
(Cambodia)
$42 – 45 USD/T Below and
above 25%
Thai root price (25%)
Farm gate = $28

16. -200
-100
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100
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600
700 Oct-09
Mar-10
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Feb-13
Jul-13
Dec-13
May-14
Oct-14
Mar-15
Aug-15
Jan-16
Jun-16
Nov-16
Apr-17
USD/MT
Difference
Tapioca starch (Super High-Grade) FOB Bangkok
Corn starch, Midwest
Tapioca and maize starch prices
=

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Jan-98
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USD/t
80%Cassava+20%Soymeal (USD) Thai Corn (USD) US Maize (FOB Gulf)
Feed prices in Thailand: cassava x soymeal

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Oct-09
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Oct-14
Mar-15
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Apr-17
USD/Litre
Root cost in Ethanol (Indonesia) Root cost in Ethanol (Thai)
CBOT Ethanol (USD/litre)
Biofuel prices and root equivalent price

19. Farmer incomes, livelihoods and productivity
• The correction in the root price has made cassava a more
competitive feed stock for industry applications where
previously they competed against low maize and other
commodity prices.
• However, cassava farmers have suffered significant
reductions in farm gate prices and household incomes
• Caution against market interventions that reduce the
competiveness of the crop relative to substitutes and
alternative markets (eg. price floors)
• Advocate for policies that drive innovation and
competitiveness
• Enhancing productivity and reducing costs will be key to
viable smallholder cassava in Indonesia and the region

20. Current location of cassava and maize production

21. Crop suitability under current climate conditions

22. Change in crop suitability under climate change

23. Pest and disease a new challenge for food security and the
cassava industry in Indonesia

24. Assessment of existing technologies with farmers,
traders, processors
• Understanding of the value chain and production
systems is setting the priorities for:
• What we do: establishing demonstration trails
based on demand from farmers, traders,
processors.
• Where we do it: locating activities where possible
on factory or trader land or where other
stakeholders (next users) can utilize it for scaling.
• How we evaluate: what is the value proposition or
business case of this next-user scaling it to final
users (farmers)

25. New varieties for new markets help smallholder cassava
remain competitive

26. Conclusion
1. Indonesia remains one of the largest producer of cassava in Asia
2. Indonesia has the highest consumption of cassava per capita of any
country in Asia
3. Indonesia is a large importer of cassava starch (Tapioca) and starch based
products
4. This consumption of products derived from starch will continue to
increase in Indonesia (and within the region) as incomes rise
5. Climate change will impact cereal crop production in Indonesia while
cassava is relatively resilient
6. While there are new challenges for cassava on the horizon
7. Many new opportunities for cassava in Indonesia and Southeast Asia

27. Join the conversation at : https://www.facebook.com/groups/1462662477369426/
ACIAR Cassava Value Chain and Livelihood Program