The Bamboo and Rattan Sectors in Asia: an Analysis of ... - INBAR

Harvesting of the planted rattan has not yet commenced. Therefore, the study
team investigated the wild rattan-based PCS as it is currently practiced in Java. In
this system, rattan growing in state forest land is harvested by hired labor from
villages adjacent to the forest areas. Perum Perhutani organizes commercial-scale
cutting. The manager identifies a buyer (who specifies the type and quantity of rattan
required) and hires the required labor from local villages. The hiring is for a short
term and usually payment is on the basis of harvested volume. The main management
input is the harvest planning and the harvesting itself. Forest areas to be harvested
are divided into several cutting blocks based on a rough rattan inventory. The blocks
are then harvested sequentially. Once harvested, the rattan is sold, either by Perum
Perhutani or by agents, to the processing industry in Java.
Java is the base for a very large rattan furniture and handicrafts industry. The
two main centers of this industry are Cirebon and Surabaya. The Cirebon-based
industry consumed 39 000 tons of rattan in 1995, while the Surabaya-based industry
consumed 42 000 tons. Rattan product exports from these two industry centers earned
US$345 million in 1995. Current product lines require approximately 70% largediameter
cane and 30% small-diameter cane, though this distribution is subject to
change as fashions change. Bulk (70%) of the current supply originates in Sulawesi,
and a large percentage of the remainder comes from Kalimantan and Sumatera.
In Cirebon, there are about 780 rattan furniture and handicrafts manufacturers,
employing over 40 000 people. The Surabaya industry is somewhat larger. The units
themselves range in size from large firms employing 100 or more people, with capital
investments of over Rp 1 000 million, down to home-based units with 1-5 employees
and capital investments of less than Rp 190 million. This small-scale segment of the
sector employs the largest number: 750 units and 32 000 workers in Cirebon in the
formal sector. There are another 35 000 formal sector employees in Surabaya, and
many more employed as daily laborers. Three-fourths of workers are male, though
more women are employed in the larger units. Women tend to be assigned detail
work and finishing. This is more common in enterprises that can afford labor
specialization.
There are also many sub-contractors. They normally have some fixed capital
investment in a workplace/storage space and tools, plus some working capital
(supporting material costs plus a small part of working wages). For most subcontractors,
the largest part of raw material cost and working wages are provided by
large-scale manufacturers (contractors) as loan to be repaid after work is completed
and sales revenue realized.
Industry people reported having some problems with the seasonal supplies of
rattan, though annual supply is adequate for now. Still, prices were increasing for
rattan but not for finished products. Good quality large diameter cane from Sulawesi
is in short supply owing to an inter-island trade ban on unprocessed cane. Small and
home industries have difficulty competing to acquire raw material. This situation is
worsened by the increasing trend toward vertical integration in which procuring of
65