Fri, 02 Jun 2006

EPFM sets sights on Java to double sales growth

The Jakarta Post, Jakarta

South Sulawesi-based PT Eastern Pearl Flour Mills (EPFM) is aiming to expand its market in the crucial Java region by introducing new 1 kilogram packs of its flour products.

EPFM sales and marketing director Oskar Fajar Damanik said that the strategy was expected to help double sales growth to 10 percent this year to 470,000 tons.

"We're trying to increase the awareness of consumers in Java about our brands by launching the 1 kilogram packs for retail buyers on the island," Oskar said at a launching ceremony for the new products Thursday.

He added that increased awareness of the company's brand should also help increase sales of its mainstay 25-kilogram flour packs in the region.

EPFM national sales manager Rudy Soeparman said that the company was targeting Java as the heavily-populated island accounted for 60 percent of the national flour market, which stood at 3.4 million tons in 2005.

Last year, the company sold 420,000 tons of flour, 60 percent of which was sold in the eastern part of Indonesia.

EPFM has a 12 percent share of the flour market and is the country's second largest flour miller after PT Bogasari Flour Mills, which controls 60 percent of the domestic market.

Despite tough competition, particularly from increasing imports of cheaper flour from China, India and Turkey, Oskar said he was optimistic that the local industry would enjoy healthy growth this year on the back of strong demand at home.

To meet the increasing demand, the company, which is jointly owned by Malaysia-based Agrifood and Netherlands-based Cargo Bulk Funding, plans to increase its production utilization rate from 70 percent to between 80 and 90 percent in 2008, Oskar said.

He also said that EPFM, which produces 2,800 tons of flour per day, was working together with Hasanuddin University to establish an experimental wheat station to reduce import costs.

Indonesia imports wheat from a number of countries, including the United States, Australia, Canada and Ukraine.

According to figures from the Industry Ministry, Indonesia imported 4.55 million tons of wheat in 2004, an 82 percent increase over the 2.5 million tons imported in 2003.(09)