The policy landscape and supply chain governance of the Indonesian seaweed industry: A focus on South Sulawesi

red seaweed in foreground and small green boat on water in background

The Indonesian seaweed industry is at a crossroads. The implementation of the national roadmap outlined in Presidential Decree 33-2019 has reached its final stage and the Indonesian government has to decide if this national approach continues.

The roadmap was created to improve upstream and downstream seaweed industries and boost the economic value of the commodity. A decision about what happens next can be informed by a clear understanding of the complex issues facing the seaweed industry from the perspective of businesses and other stakeholders.

Our study, conducted between April and October 2022, provides a comprehensive overview of the Indonesian seaweed policy landscape and supply chain governance. It used a combination of in-depth interviews, group model building with more than 120 participants and a desk review.

The study found some progress has been made but significant challenges still exist.

These include the impact of the pandemic, the complexity of supply chain governance and the shifting policy landscape. This research into one of Indonesia’s biggest seaweed regions also highlights the layered policy environment and supply chain governance that surrounds the industry. The review of 67 policy documents reveals a vast and rapidly changing policy landscape in Indonesia and shows the importance of stakeholder consultation in ensuring policy relevance.

The study also identifies the complexity of the seaweed supply chains in South Sulawesi and Indonesia with different levels of competitiveness between processors, exporters and local chain actors such as traders and farmers.


Click here to read the full landscape and supply chain governance report here


As would be expected the stakeholders have different priorities and interests however there was a clear and shared view about the urgent need to address quality issues at both the seedstock and commodity output stages of production and supply chain availability at the domestic processing and export levels. This report provides a tool for policymakers to target and address these issues effectively.

We propose five policy recommendations to achieve an inclusive, sustainable and globally competitive Indonesian seaweed industry:

  • Strengthen national mechanisms for the seaweed industry: A strong national approach is needed to continue supporting the seaweed industry. Development will come from addressing numerous elements. These include cross-sectoral policies, inter-ministerial coordination, task distribution, multisectoral collaboration, monitoring and evaluation and education and training. A focus on improving seed quality, production data, logistics and marketing, inclusiveness, blue growth, digital technology in the seaweed industry and global competitiveness.
  • Improve data quality and monitoring: Increase access to high-quality data for guiding the seaweed industry, review production data methods, integrate different data sources and promote the use of indicators and monitoring and evaluation methods.
  • Support smallholder seaweed producers and local governance: Recognise the importance of smallholder farmers, improve supply chain governance and consider the role of local governance in future development programs.
  • Strategise stakeholder engagement and promote private sector: Maintain involvement of multiple stakeholders through a multisectoral collaborative approach, provide recommendations for stakeholder engagement based on analysis and identify effective communication and coordination strategies. Recognise the importance of private sector contribution to innovation, competitiveness and investment in smallholder farming.
  • Integrate ‘Blue Economy’ concept: Stay informed about the Blue Economy roadmap developed by the national development agency Bappenas and incorporate the Blue Economy concept into future strategy to align with current trends and initiatives.

This study is part of a comprehensive investigation into the seaweed value chain in South Sulawesi, covering everything from production to consumption.

The analysis of the South Sulawesi seaweed sector also provided insights into the impact of global forces, the structure of value chains and the effects of the COVID-19 pandemic on more than 25,000 households along the coast involved in seaweed farming. It also examined opportunities for Indonesia to capitalise on its competitive advantage and sustainably upgrade its seaweed industry.

Feature image by PAIR