Govt under fire for plan on wheat duties<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
The Indonesian monopoly watchdog has slammed the government's
\nplan to impose antidumping duties on wheat as the move would
\nbenefit only one single company, PT Bogasari Flour Mills, at the
\ncost of millions of consumers.<\/p>\n
The Business Competition Supervisory Commission (KPPU) argues
\nthat imposing additional duties for wheat would also affect
\nfuture competition in the wheat grinding industry, and thus would
\nonly support Bogasari's market domination.<\/p>\n
\"The policy will only benefit this big wheat flour producer\",
\nKPPU chairman Mohammad Iqbal said, at a media conference on
\nFriday.<\/p>\n
Earlier, the Indonesian Antidumping Committee under the
\nMinistry of Industry and Trade proposed countervailing duties on
\nwheat based on a report filed by Bogasari, a unit of publicly-
\nlisted food producer PT Indofood Sukses Makmur.<\/p>\n
Bogasari has been losing out in business to a number of local
\nwheat flour producers, following the opening of the domestic
\nwheat market in 1998.<\/p>\n
Before the opening, Bogasari controlled almost 90 percent of
\nthe domestic wheat flour market. Its market share dropped to 68
\npercent in 2000.<\/p>\n
Iqbal noted that fairer competition had made Bogasari lose
\nout, while other domestic wheat flour producers like Sriboga,
\nPangan Mas and Berdikari gained a greater foothold.<\/p>\n
He also noted that Bogasari had lost out in business due to
\ncompetition and unnecessary production expansion at a time of low
\nutilized capacity. It had nothing to do with the alleged dumping
\npractices.<\/p>\n
Besides, Bogasari, with its extensive distribution networks,
\nbooked a relatively high operating profit of 23.9 percent,
\nwhereas similar producers in other countries only booked 15
\npercent.<\/p>\n
Therefore, slapping more duties on wheat imports would not do
\nany good to competition. In addition, it would punish consumers
\nwith more expensive wheat flour.<\/p>\n
Bogasari, Iqbal said, should not cry for help as it had a
\ncaptive market of 47.25 percent of domestic market shares by
\nsupplying wheat flour to its parent company, Indofood.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-under-fire-for-plan-on-wheat-duties-1447893297",
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