Indonesia has earned a strong reputation for its furniture products, known for their quality craftsmanship and competitive prices. With a history firmly rooted in woodworking traditions featuring a rich cultural heritage, Indonesia offers distinctive designs that attract furniture enthusiasts from around the world. The furniture manufacturing industry in Indonesia has successfully recorded growth in recent decades, with the preliminary
reaching around 42 trillion Indonesian rupiah in 2023. With an abundance of raw materials, natural resources, and skilled craftsmen, Indonesia has great potential to become a leader in the global furniture market.
Indonesia’s furniture market landscape
Indonesia’s furniture industry is one of the labor-intensive sectors that relies heavily on export activities. In 2023, the
number of workers in large and medium-scale furniture manufacturing alone amounted to approximately 164 thousand people. The industry has been designated as one of the country’s priority sectors, receiving strong support from the government to ensure expansion. The government has set a target to significantly increase the country’s furniture exports. Furthermore, it encourages furniture companies to establish partnerships and collaborations with foreign players in the industry to expand their presence in the global market. Currently,
Indonesia’s main export markets for furniture include the United States, Japan, and the Netherlands.
Teak and mahogany wood are most commonly used in this industry due to the high demand from both local and international markets for furniture products made from these materials. However, with the increasing emphasis on eco-friendly furniture products in the global market, Indonesia also intends to put more focus on its rattan furniture to drive its overall industry growth. In 2022, the
value of rattan furniture exports from Indonesia totaled approximately 37 million U.S. dollars, the
majority of which was exported to the United States.
Navigating the challenges and opportunities of Indonesia’s furniture market
With an emphasis on export performance, Indonesia has neglected its domestic market. As a result, the local market is flooded with imported furniture products. The growing demand for imported furniture products is reflected in the massive expansion of foreign brands, such as IKEA, in Indonesia. In 2022,
Indonesia recorded a total furniture import value of 331 million U.S. dollars, with 290 million U.S. dollars’ worth of
imported furniture coming from China. In addition, illegal logging and trading of timber have also caused a shortage of raw materials for this industry, leading to persistent challenges in production. The government hopes to stop these illegal practices and improve the competitiveness of Indonesian timber products through the Indonesian Timber Legality Assurance System (SVLK). Targeting the domestic market and increasing the supply of raw materials for this industry will further boost
industrial productivity and growth, paving the way for Indonesia to become a furniture market leader in the global arena.
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