Indonesia was the fourth-largest producer of coffee in the world in 2014. Coffee cultivation in Indonesia began in the late 1600s and early 1700s, in the early Dutch colonial period, and has played an important part in the growth of the country. Indonesia is geographically and climatologically well-suited for coffee plantations, near the equator and with numerous interior mountainous regions on its main islands, creating well-suited microclimates for the growth and production of coffee.

Indonesia produced an estimated 660,000 metric tons of coffee in 2017. Of this total, it is estimated that 154,800 tons were slated for domestic consumption in the 2013–2014 financial year. Of the exports, 25% are arabica beans; the balance is robusta. In general, Indonesia's arabica coffee varieties have low acidity and strong bodies, which make them ideal for blending with higher-acidity coffees from Central America and East Africa.

Today, more than 90% of Indonesia's coffee is grown by smallholders on farms averaging around one hectare. Some of this production is organic and many farmers’ cooperatives and exporters are internationally certified to market organic coffee.

There are more than 20 varieties of Coffee arabica being grown commercially in Indonesia. They fall into six main categories:

Typica – this is the original cultivar introduced by the Dutch. Much of the Typica was lost in the late 1880s, when coffee leaf rust swept through Indonesia. However, both the Bergandal and Sidikalang varieties of Typica can still be found in Sumatra, especially at higher altitudes.

Hibrido de Timor (HDT) – This variety, which is also called "Tim Tim", is a natural cross between Arabica and Robusta. This variety originated likely from a single coffee tree planted in 1917–18 or 1926. The HDT was planted in Aceh in 1979.

Linie S – This is a group of varieties was originally developed in India, from the Bourbon cultivar. The most common are S-288 and S-795, which are found in Lintong, Aceh, Flores and other areas.

Ethiopian lines – These include Rambung and Abyssinia, which were brought to Java in 1928. Since then, they have been brought to Aceh as well. Another group of Ethiopian varieties found in Sumatra are called "USDA", after an American project that brought them to Indonesia in the 1950s.

Caturra cultivars: Caturra is a mutation of Bourbon coffee, which originated in Brazil.

Catimor lines – This cross between arabica and robusta has a reputation for poor flavour. However, there are numerous types of Catimor, including one that farmers have named "Ateng-Jaluk". On-going research in Aceh has revealed locally adapted Catimor varieties with excellent cup characteristics.

All arabica coffee in Indonesia is picked by hand, whether it is grown by smallholders or on medium-sized estates. After harvest, the coffee is processed in a variety of ways, each imparting its own flavours and aromas to the final product.

A small number of Arabica farmers in Sulawesi, Flores and Bali, and almost all Robusta farmers across Indonesia, use the most traditional method of all, dry processing. The coffee cherries are dried in the sun, and then de-hulled in a dry state.

Most farmers on Sulawesi, Sumatra, Flores, and Papua use the "giling basah" (or wet hulling) process. In this technique, farmers remove the outer skin from the cherries mechanically, using rustic pulping machines, called "luwak". The coffee beans, still coated with mucilage, are then stored for up to a day. Following this waiting period, the mucilage is washed off and the coffee is partially dried for sale.

At least one U.S. manufacturer, soft drink producer Bai, purchases the non-bean remnants of coffee cherries for use in their products. Otherwise, these remnants are discarded.

Collectors and processors then hull the coffee in a semi-wet state, which gives the beans a distinctive bluish-green appearance. This process reduces acidity and increases body, resulting in the classic Indonesian cup profile.

Larger processing mills, estates and some farmers' cooperatives on Sumatra, Java, Sulawesi and Bali produce "fully washed" coffee.

The most unusual form of coffee processing in Indonesia is "kopi luwak". This coffee is processed by the Asian palm civet (Paradoxurus hermaphroditus). The animals eat ripe coffee cherries and their digestive process removes the outer layers of the fruit. The remaining coffee beans are collected and washed. Coffee experts believe that the unique flavour of kopi luwak comes, at least in part, from the extraction of naturally occurring potassium salts from the beans during the digestive process. This results in a smooth, mild cup, with a sweet after-taste. Kopi luwak is very rare, and can retail for more than $600 per kilogram.

Coffee robusta is grown at lower altitudes than Coffee arabica. The island of Sumatra is the largest producer, with the provinces of Lampung, South Sumatra and Bengkulu accounting for 50% of total national coffee production and up to 75% of Robusta production. Smaller volumes are also grown in Kalimantan, Sulawesi, Bali and Flores.

Robusta is grown on small farms that average one hectare. The crop is harvested by stripping off all the fruit on the branch, resulting in a mix of ripe and green cherries. Farmers dry the coffee cherries whole, for up to three weeks. After the drying, the dry cherries are hulled. Farmers sell the cherries to collectors, who sell them to both exporters and for sale on the domestic market. The exporters dry the crop to 12 to 13% moisture, and it is then sorted and graded. Exports are usually made in break bulk shipments, rather than in containers as with C. arabica.

A small portion of the crop is harvested and processed was washed coffee as with Arabica coffee.

Most of Indonesia's robusta is used in instant coffee and other manufactured products. The domestic market consumes about 150,000 metric tons of robusta annually. The main markets are the United States, western Europe and Japan, although demand from emerging markets such as Russia, China, Taiwan, South Korea and Malaysia is increasing.

Robusta is also an important part of traditional espresso blends, where it adds characteristic flavours and the all important crema on top of the coffee.

The Indonesian coffee sector is large, internally diverse and scattered. Production is dominated by an estimated 2 million smallholders living in often remote villages located right across the archipelago—with different coffee regions showing variations in terms of production systems, environmental conditions, product quality, post-harvest processing, and value chain structures. This distinctive geography poses challenges for logistics, for supporting improved technologies, and for developing cohesive industry organizations. Common to most of the coffee-producing regions are circumstances of low yields, weak farmer organization, and limited government support—as coffee has hitherto not been regarded as a crop of strategic importance.

*source : wikipedia (Indonesia's Coffee)