Java big sugar

The history of sugar in colonial Indonesia, as that of many other colonial commodities in Asia, is generally treated as simply a part of agrarian or peasant histories. It is also generally understood in terms of an economic enterprise jointly undertaken by colonial and metropolitan entrepreneurs and in which the colonial state is held to have overtly or covertly played a prominent role. Hence, the history of Java sugar, or other commodities for that matter, is told from the perspectives of colonialism and its economic imperatives.

The book under review contributes to the historiography of colonial Indonesia in two major ways. First, it inverts the approach by making sugar central to the historical narrative and using the commodity as a tool to explain the dynamics of Indonesia’s rural economy, colonial agrarian policies, and local and metropolitan responses to economic opportunities in the colony. Second, it moves away from the paradigm that considers colonial state as a monolithic entity always impacting and influencing economic actors and their activities. Instead, by narrating the story of sugar, the book underlines how changing prospects of sugar production and trade in Java impacted the colonial state and its policies and how the economic opportunities arising in the industry posed new sorts of challenges to the state. The story of sugar helps to uncover inconsistencies and contradictions within the state and highlights, as the author says, the many faces or varieties of colonialism (p.x).

The book tells the story of ‘big sugar’, that is industrially-manufactured mass-produced raw or ready-to-eat white sugar. It explains how the island of Java that seemingly lacked the attributes comparable to those of the Caribbean sugar industry, could so successfully dominate the world sugar market for about half a century. The author notes in the introduction that Java’s agrarian, financial and colonial contexts in the early nineteenth century did not look so adequate as to anticipate an exponential growth in the industry later in the century. The rest of the book explains how that was accomplished.

Colonial Java and the world sugar economy

For sure, the story of the rise of big sugar in Indonesia can be understood only in the context of fluctuations in global sugar production and consumption. The author traces the beginning of an exponential rise in sugar production in Java with the crisis in the world sugar market in the mid-1880s that not only upset production and exports globally but also caused some major changes in the structure of demand. There was during this time, according to the author, a spurt in the growth of demand for fine white sugar in China and South Asia, which spurred the rise of Java’s big sugar industry. The rise of big sugar is, thus, rightly attributed to the shift in the export destination of Java sugar from Europe to Asia from the late nineteenth century onward. Java sugar depended so much on these new markets that the industry almost entirely collapsed when the demand dropped drastically in the early 1930s. What enabled Java to tap this new opportunity? In seven successive chapters, the author explains how the industry overcame the inadequacies of Java’s agrarian order, devised novel financial strategies to meet the costs of new machines and expansion of production units, and navigated the challenges of the colonial state’s ambivalence with regard to big sugar. In the nineteenth century, radical developments occurred in the sphere of agrarian production and an intensive use of fertilizer in cane fields enabled the industry to overcome the problems caused by shortage of land for expansion of cane cultivation on the island. This, coupled with a more efficient use of labour in closely supervised agricultural operations, led to the emergence of a highly developed agro-industry of cane in Java. When these measures proved insufficient for further expansion of the industry in the 1910s, the production base moved away from the densely peasant-populated agrarian zones to the ‘remote’ far southeast of the island. A new and large sugar factory was established there, but this was an expensive enterprise and it failed to meet the desired levels of productivity and profits. To continue its expansionary trajectory, new possibilities of growth had to be found within the traditional Javanese peasant agriculture. The author argues that in the 1920s the industry found new opportunities to grow in the changing agrarian conditions (low wages), falling import prices of fertilizer, and advancements in horticulture especially the development of high-yielding variety of cane. By 1930, consequently, Java not only produced twice as much sugar as it had done a decade earlier but also produced it much cheaper than before.

Financial and colonial contexts

The author investigates (in chapter four) in detail how the expansionary projects, which were expensive undertakings, were financed. He underlines two main characteristics of the big sugar industry in colonial Java. First, it was almost entirely owned and controlled by a few large Dutch companies based in the Netherlands and organized more or less as family firms. Second, the industry was almost entirely self-financed. Funds for expansionary projects were raised primarily by withholding profits. The industry did not depend on borrowed money or capital flowing from Dutch or other overseas markets. This gave the companies a free hand in so far as spending and investments were concerned and contributed, as the author notes, to Java sugar industry’s ability to survive the intermittent crises inflicting the world sugar economy and ensure its historical longevity. But, such a strategy also limited the commercial opportunities that might otherwise have been available to Java sugar.

An interesting aspect of this study is the author’s analysis of the role of the colonial state in the sugar enterprise. Two things come up very clearly. The colonial state could not provide commercial security to the Java sugar industry as it, unlike other European empires, did not possess large markets at home or elsewhere. One, however, would like to know what role the colony itself played as a market for Java sugar during this period. It also could not initiate land or labour legislations favourable to the industry. On the contrary, the state bureaucracy was inclined to preserve the traditional peasant economy of Java which it apprehended big sugar sought to disintegrate. It was only in the 1920s that the colonial state turned in favour of big sugar and there emerged a ‘corporate state’ that, according to the author “held Big Sugar and the state bureaucrats in a mutual embrace” (p.237). Even then, the state was not a reliable ally of the sugar industry because it failed, when an opportunity arose, to push forward a potential trade-off between Japanese cotton and Java sugar that would have helped the sugar industry to retain its East Asian markets at least.

In the last chapter, the author explains the decline of big sugar in the 1930s and attributes it to Java’s loss of East and South Asian markets. This was on account of the emergence of Japanese sugar autarchy in East Asia and the beginning of large-scale production of industrially manufactured sugar in the Indian subcontinent. He argues that the loss of Asian markets did not lead to the demise of the sugar industry in Java. In the late 1930s, the industry revived and by 1942, it regained some 60 percent of its total production of peak years of the late 1920s.

The publication

The book is a fascinating story of the rise, decline, and continuity of Big Sugar in the Dutch East Indies and the author rightly attributes this trajectory to the Asian connection that colonial Java could establish during this period. He emphasises the continuity of sugar production in Java after the early 1930s crisis. What is less explicit in the story, however, is the historical precedence. In the eighteenth century too, Java held a front rank position in the world sugar economy and that was precisely because of its Asian connection. During that period, Java sugar dominated the markets in Japan, and much of West and South Asia. The book clearly shows that the era of Big Sugar was a distinct phase in the long history of the industry. The author draws upon a wide range of primary data and rich literature, challenges some of the long-held assumptions about the rise and decline of the industry, and offers a new perspective on the history of sugar in late colonial Indonesia. It is a valuable addition to the literature on Indonesian sugar production and trade and on global commodities.

Ghulam A. Nadri, Department of History, Georgia State University (gnadri@gsu.edu)