Indofood to boost output to meet higher demand

Indofood to boost output to meet higher demand

JAKARTA (JP): Publicly listed food giant PT Indofood Sukses
Makmur plans to raise its instant noodle production by 6.25
percent to 8.5 billion packs next year to meet an expected higher
domestic and overseas demand.

Indofood's chief executive officer (CEO) Eva Riyanti Hutapea
said on Friday that about 14 million packs of planned production
would be exported.

"We plan to raise our production capacity to 8.5 billion packs
of instant noodles annually next year. With the increase in
production, we also plan to raise exports," she said after the
ceremony in which the company received an ISO 9002 certification.

Eva said the increase in production capacity would come from
Indofood's plants throughout the country, including from its
biggest plant in Cibitung.

"Our plant in Cibitung owns 23 production lines, one of the
biggest instant noodle plants in the world," she said.

She said exports had become an attractive alternative to
Indofood following sluggish domestic demand since last year as a
result of the economic crisis.

In the past three years, Indofood has exported instant noodles
to the United States, Canada and European countries, such as the
Netherlands, Germany, Greece, the United Kingdom, Malta and
Russia.

The company also exported noodles to South Africa,
Uzbekishtan, Kazakhtan and Middle East countries.

Exports to the Asia Pacific region have reached Taiwan, Hong
Kong, Malaysia, Brunei, Singapore, Papua New Guinea, Australia
and New Zealand, Eva said.

"Our plants were built in different places to suit our export
destinations. For example, exports to Singapore, Malaysia and
Brunei come from our plant in Pekanbaru, and our plant in
Cibitung supplies the domestic demand," she said.

To reduce distribution risks and costs, Eva said, the company
built processing plants in 11 provinces in Sumatra, Java,
Kalimantan and Sulawesi.

Currently, some local instant noodle manufacturers are trying
to emulate Indofood's distribution strategy by building plants in
places closer to customers, she added.

Eva said Indofood would continue to improve the quality of its
products to maintain its existence on the world market.

The Ministry of Industry and Trade has said that Indonesia
should be able to export more instant noodles in the coming years
following the government's approval for the operation of 13 new
noodle companies next year.

Director General of Chemical, Agricultural and Forestry
Products Gatot Ibnu Santosa said earlier this year that Indonesia
could not export significant amounts of noodles due to the fast
growth of domestic consumption in the past.

Indonesia, the world's second largest instant noodle producer
after China, has 16 producers operating in 11 provinces,
producing 8.6 billion packs or servings per annum with more than
50 brands. The giant PT Indofood Sukses Makmur dominates the
market with more than 90 percent.

In Indonesia, instant noodles first hit the market in 1969
with the Supermi brand produced by PT Lima Satu Sankyu Industri
Pangan. But instant noodles did not achieve wide popularity among
people until the early 1980s when local flavor products were
introduced.

Since then consumption has grown at the rate of about 10
percent per annum, reaching a high point in 1997 at about 8.7
billion packs before sinking to about 8 billion packs last year
when the economic crisis affected the industry.

Indonesia's instant noodle consumption per capita stood at
39.1 packs last year, down from 42.3 packs in 1997. The figure is
expected to recover slightly to 41.9 percent this year.

According to Indofood, popular flavors are onion chicken,
special fried noodles, chicken soto and special chicken, followed
by meatballs and chicken curry. (gis)