INDONESIAN AGRICULTURE GROWTH EXPECTED TO SLOW

  Indonesia"s agriculture sector will grow
  by just 1.0 pct in calendar 1987, against an estimated 2.4 pct
  in 1986 as the production of some commodities stagnates or
  declines, the U.S. Embassy said in a report.
      Production of Indonesia"s staple food, rice, is forecast to
  fall to around 26.3 mln tonnes from an embassy estimate of
  26.58 mln tonnes in 1986, according to the annual report on
  Indonesia"s agricultural performance.
      The government officially estimates 1986 rice production at
  26.7 mln tonnes, with a forecast 27.3 mln tonnes output in
  1987.
      The report says wheat imports are likely to fall to 1.5 mln
  tonnes in calendar 1987 from 1.69 mln tonnes in 1986 because of
  a drawdown on stocks.
      "Growth prospects for agriculture in 1987 do not look
  promising as rice production is forecast to decline and the
  production of sugarcane, rubber and copra show little or no
  gain," the report says.
      "The modest overall increase which is expected will be due
  to significant gains in production of corn soybeans, palm oil
  and palm kernels."
      Constraints to significant overall increases in
  agricultural output include a shortage of disease resistant
  seeds, limited fertile land, insect pests and a reluctance by
  farmers to shift from rice production to other crops, the
  report underlines.
      The fall in rice production is caused by an outbreak of
  pests known as "wereng" or brown plant hoppers in 1986 which
  largely offset gains in yields.
      The outbreak has forced the government to ban the use of 57
  insecticides on rice because it was believed the wereng are now
  resistant to these varieties, and to use lower-yielding, more
  resistant rice types.
      The government is depending on increased production of
  export commodities such as coffee, tea, rubber, plywood and
  palm oil to offset revenue losses brought on by falling crude
  oil prices.
      Palm oil production is expected to increase by over 7.0 pct
  in 1987 to 1.45 mln tonnes from 1.35 mln, with exports rising
  to an estimated 720,000 tonnes from 695,000 tonnes in 1986, the
  report says.
      But while production of soybeans in 1987/88 (Oct-Sept) will
  rise to 1.075 mln tonnes from 980,000 in 1986/87, imports will
  also rise to supply a new soybean crushing plant.
      The report says that imports of wheat, soybeans, soybean
  meal and cotton are not likely to decline as a result of last
  September"s 31 pct devaluation of the rupiah because of a rise
  in domestic demand.
      The report said that Indonesia"s overall economic
  performance in calendar 1986 was about zero or even a slight
  negative growth rate, the lowest rate of growth since the
  mid-1960s. It compares with 1.9 pct growth in 1985 and 6.7 pct
  in 1984.
      The dramatic fall in oil prices last year was responsible
  for the slump.
  

