Indonesia’s sweet spot: Tradin Organic secures fund for sustainable coconut sugar

Together with its partners, Tradin Organic will enhance the working environment for an estimated 2,275 Indonesian coconut sugar farmers and ensure a stable, high-quality supply. The company received a three-year grant from the Dutch Social Sustainability Fund through the Netherlands Enterprise Agency. 

The project, “Indonesia’s Sweet Spot: Livelihood Resilience through Innovation for Safe, Organic Coconut Sugar Product,” aims to strengthen socially responsible business practices within the coconut sugar supply chain to meet the growing demand for organic, low-carbon ingredients while improving farmers’ overall working environment. 

Food Ingredients First dives into the project’s initiatives and coconut sugar applications with Riley Linder, Tradin Organic’s category manager of dry ingredients, and Anitra van der Kraan, project coordinator funded programs. 

“Coconut sugar is produced by smallholder farmers, who produce very small quantities of sugar, which places them at high risk of achieving adequate income and having access to funding to invest in their production,” says Van der Kraan. 

“The grant program ensures that necessary investments are made to understand the farmers’ needs better while ensuring that there are activities taking place to improve their conditions from the perspective of income, safety, and health.” 

Linder adds that coconut sugar “is well received by customers who seek clean label, health-focused products, especially those who bake at home and use nontraditional table sugars. This market segment has seen double-digit growth in recent years.” 

Linder and Van der Kraan will also highlight the project at Tradin Organic’s stand (5-311) at Biofach, the upcoming organic food trade show (February 11–14). 

Socially responsible business

The project will focus on multiple initiatives to ensure better health, economic security, and environmental sustainability for 2,275 participating farmers and their households in Central Java, Indonesia. Tradin Organic has launched the three-year project with its partners Daya Alami, Inagro, LPPSLH, and Imset. 

Van der Kraan says the project aims to improve cooking technology by researching and introducing “alternative cooking stoves to improve health (respiratory issues), reduce production costs (fuel), increase production efficiency, and reduce emissions.” 

Van der Kraan says that smallholder coconut farmers are at a high risk of achieving sufficient income and funding to invest in their production.Moreover, she highlights the project will “research and develop a carbon insetting program to valorize the emission reduction at the farmer level.” 

It will also research farmers’ current income situation and the potential income increase from the different interventions to improve the living income and wage. 

Van der Kraan says the project will “assess the feasibility of dwarf trees to reduce accidents and ease labor and the introduction of and training on how to cultivate the new variety.” 

Regarding training and capacity building, the project will “research farmer-level knowledge and training gaps, improve training and capacity building on organic integrity, food safety, productivity, etc.” 

She adds that this includes training farmers on these topics and using alternative stoves and dwarf trees. 

Coconut sugar benefits

According to Linder, coconut sugar can be used as a 1:1 replacement for traditional sugars, such as cane sugar. “Tradin sees the greatest demand in baking, beverage, and sweet and snack applications, while many consumers buy coconut sugar to use directly for at-home ingredient applications.”

He says coconut sugar has a strong growth trajectory from a consumer standpoint, benefiting from interest in gluten-free, low-glycemic index sweeteners, non-GMO, and clean label ingredients. In addition, coconut sugar has a higher mineral content than table sugar. 

According to Linder, coconut sugar demand benefits from consumer interest in low glycemic index sweeteners and clean label ingredients.Experts note that low-glycemic ingredients help reduce risks of type 2 diabetes and coronary heart disease, while they can help manage weight. 

In addition, consumers are becoming more aware of the health benefits of organic food and the impact their food choices have on a sustainable food supply. Innova Market Insights data indicates organic claims are expanding across F&B categories. 

However, Linder highlights that the ingredient is “at high risk due to climate change and farmer attrition.”

“The investment to promote the industry at the farm level is crucial to the longevity of the market channel. One example of future developments is the opportunity to transition the coconut tree variety to a shorter, slower growing variety to help farmers more quickly and safely collect sap.”