Indonesia's Halal Industry and Exports: Regulation, Ingredients, and Markets

Halal certification is often discussed as an administrative obligation within the country. Yet for export-oriented industries, a halal certificate serves as a market document. Destination countries with their own halal authorities will request traceable evidence, not just a label.

This article discusses the industry and export side: how Indonesia's regulatory framework shapes the readiness of business actors, and why critical ingredient points become a decisive issue.

The Regulatory Framework That Shapes Industry Readiness

The foundation of the halal certification obligation is set through Minister of Religious Affairs Decree Number 748 of 2021 on Types of Products Required to Be Halal-Certified. This KMA sets out the product groups required to be certified along with their phasing, and has been amended by KMA 944/2024.

The latest amendment to Law 33/2014 came through Law Number 6 of 2023, which enacted Perppu Cipta Kerja (the Job Creation Regulation in Lieu of Law) into law. This regulation simplifies the certification process, introduces the halal statement (self-declare) scheme for UMK (micro and small enterprises), and paves the way for the Halal Product Fatwa Committee.

At the implementation level, Government Regulation Number 42 of 2024 on the Implementation of Halal Product Assurance replaces PP 39/2021. This PP governs the procedures for establishment, accreditation, scope of activities, and revocation of LPH (Halal Inspection Agency) approval, as well as the appointment and dismissal of Halal Auditors.

For the technical side of business actors, the main reference is the Head of BPJPH (Halal Product Assurance Agency) Decree Number 57 of 2021 on the Criteria for the Halal Product Assurance System, which was amended by Kepka 20/2023. This decree contains five SJPH criteria: commitment and responsibility, ingredients, halal product processes, products, and monitoring and evaluation.

Why Ingredients Are Decisive on the Export Track

For industry, the ingredient criterion is the part that demands the most documentation. Buyers in export markets generally request ingredient traceability down to the originating producer, not merely a halal statement from the supplier.

Some ingredients demand greater attention because their status depends on the source. For example:

• L-Cysteine (E920). A dough softener for bread that has historically been extracted from human hair or poultry feathers. The alternative is certified L-Cysteine from microbial fermentation, or plant-based dough-softening enzymes. This ingredient is commonly used in mass-produced white bread, burger buns, and commercial pizza dough.
• Collagen. A structural protein from animal skin or bone; its source determines halal status just as with gelatin. The alternatives are fish collagen (marine collagen) or halal-certified beef collagen. It is widely used in beauty supplements, collagen drinks, and skincare products.
• Alcohol or ethanol. A solvent and preservative whose status depends on the source, concentration, and purpose of use. The alternatives are non-alcohol plant-based solvents, or synthetic ethanol with source and concentration documents verified by the LPH. This ingredient is common in flavor and color solvents, vanilla extract, fermented products, and liquid medicines.
• Carmine or cochineal (E120). A natural red colorant from the cochineal insect; scholars differ on its status. The alternatives are plant-based red colorants such as beet, anthocyanin, or lycopene. It is used in red-colored beverages, candy, lipstick, fruit yogurt, and processed meat products.

This list is not exhaustive but illustrates the same pattern: an ingredient's status cannot be inferred from its name, but from its source and documents.

From Compliance to Document Readiness

The practical consequence is that industry needs to treat SJPH as a living documentation system. Ingredient registers, supplier records, and internal audit results must be consistent with one another. When a destination market requests clarification, what is assessed is the company's ability to show the ingredient trail, not the speed of responding to questions.

It should be noted that the determination of halal status is the authority of the MUI (Indonesian Ulema Council) Fatwa Commission or the Halal Product Fatwa Committee, while the certificate is issued only by BPJPH. Therefore, a company's internal documents serve as supporting evidence, not as the determinant of a product's halal status.

For exporting industries, these two things go together: meeting domestic obligations and preparing evidence acceptable to trading partners. Both rest on the same thing, namely orderly ingredient traceability starting from the supplier.

If your company needs to tidy up ingredient registers, map critical points, and prepare internal audits before an external inspection, the SJPH platform from IndoHalal.id helps manage all SJPH criteria in a single application.