Association reluctant to ban Australian sugar
JAKARTA (JP): The Indonesian Sugar Association (AGI) said on Wedneday it opposed a plan to stop imports of raw sugar from Australia.
"A boycott is a political decision, while our activities are purely based on business," the association's chairman Faruk Bakrie told The Jakarta Post.
He said that the association had no authority to ban its members from halting their imports in retaliation of anti- Indonesia sentiments in Australia.
Sahat M. Sinaga, director of the agro-based industry division at the office of the State Minister of the Empowerment of State Enterprises announced on Tuesday that local sugar mills had decided to halt imports of raw sugar from Australia as a protest against the neighboring country's "unfriendly manner" against Indonesia.
He told journalists after a meeting with local sugar mills that Australia's hostility was clearly shown when labor unions rejected the handling of Indonesian goods at Australian ports.
Sahat's statement was confirmed by Asep Thoyib, executive director of the joint marketing division of state plantation firm PT Perkebunan Nusantara, saying that his company and some private sugar firms had all agreed to stop sugar imports from Australia.
"We will only make deals with countries which respect Indonesia," Asep said.
Australian unions boycotted goods leaving for and coming from Indonesia in early September in an effort to pressure the Indonesian government into restoring order in East Timor.
The unions lifted the boycott late last month, but threatened to resume it if Indonesia restricted the multinational peacekeeping force in East Timor.
Minister of Trade and Industry Rahardi Ramelan pledged last week that the government would help local importers who wanted to switch their imports of required raw materials from Australia to find substitute supply sources.
Rahardi said it should not be difficult to find alternative supply sources. He said Indonesia could easily import more raw sugar from Thailand, Brazil, China and Pakistan.
Indonesia's import of raw sugar from these countries reached 640,000 tons during the period of January to October this year.
While the country's imports from Australia during the same period alone reached about 320,000 tons, worth a total value of US$56 million.
David Rutledge, chief executive of Australian sugar exporter Queensland Sugar Corp (QSC), was quoted by Dow Jones on Wednesday as saying that no sugar shipments to Indonesia had ever been affected by the union work bans.
Rutledge said he needed to get clarification on the boycott report as he was not aware of any raw sugar shipments from Australia to Indonesia being halted.
QSC itself exported about 157,000 metric tons of raw sugar to Indonesia in the last fiscal year which ended in June.
Meanwhile, the country's largest instant noodle maker PT Indofood Sukses Makmur said it would divert wheat imports from Australia to Canada, the United States and European countries in fear of discontinuity of wheat supply following the Australian dock union workers refusal to load Indofood's ordered wheat at Australian ports early last month.
Indofood's director Franciscus Welirang claimed the shift was not meant to boycott Australian wheat though he admitted that "if the government decides to do so, we will follow."
Indofood's total wheat imports stood at 3.2 tons last year. The figure is predicted to be about 3.1 tons this year. Indofood currently obtains about 50 percent of its wheat supply from Australia. (udi/cst)