Minister urges coffee consumption to stabilize price

Minister urges coffee consumption to stabilize price

SURABAYA, East Java (JP): The minister of agriculture,
Sjarifudin Baharsjah, called yesterday for a campaign promoting
drinking coffee.

The minister said an increase in domestic coffee consumption
was needed to stabilize local coffee prices.

"One way to stabilize the price is by selling more coffee
domestically," he said.

He said unstable prices were largely because of coffee
suppliers being too dependent on international markets and this
really hurt local coffee farmers.

The president director of Aneka Coffee, Jeffry Sanusi
Soedargo, said coffee consumption in Indonesia was only 0.8
kilograms a person a year, compared with average consumption in
developed countries of between four to five kilograms a person a
year and Scandinavian countries where the average was 12
kilograms a person a year.

Sjarifuddin said with their rising incomes, Indonesians should
be consuming 1.6 kilograms of coffee a year.

He called on domestic coffee distributors to learn from
Japan's distributors who successfully promoted coffee drinking in
a tea-drinking society.

The minister was speaking at the opening of Aneka Coffee's new
plant in Sidoarjo.

Aneka Coffee is 65 percent owned by Prasidha Aneka Niaga, 20
percent by Japanese trading house Itochu, 10 percent by PT
Citrabuana Tunggal Perkasa and 5 percent by Japan's UCC Ueshima
Coffee Co. Ltd.

Prasidha Aneka Niaga which listed on the Surabaya and Jakarta
Stock Exchanges in 1994 is Indonesia's biggest processor and
exporter of food and plantation commodities.

The US$23 million plant covering 30,000 hectares has a
designated production capacity of 2,400 tons of ground coffee a
year and 3,600 tons of instant coffee a year, making it one of
the biggest coffee plants in South East Asia.

Eighty percent of the instant coffee and 20 percent of the
ground coffee will be exported to Europe, Japan and America.

"We are also eying China's market as one with big potential,"
Jeffry said.

Prasidha Aneka Niaga exported 100,000 tons of coffee last year
-- a quarter of the total country's export of 400,000 tons -- all
of which from farmers. Prasidha and Itochu planned to open 600
hectares of coffee estate in Bengkulu this year to produce high
quality coffee.

Mansjur, who is also head of the Association of Indonesian
Coffee Exporters' promotion office, said the country's coffee
output was likely to fall 15 percent in April's harvest. Heavy
rains and strong winds hindered the second flowering of trees in
coffee producing areas late last year.

Last week International commodity bourses were hit by rumors
that Indonesia's coffee output might fall up to 40 percent.

Prasidha Aneka Niaga said it would soon sign two joint
ventures with overseas commodity sector firms.

It will set up a joint venture with Itochu Corp to make crumb
rubber for export.

Prasidha said it would own 51 percent of the venture, with
Itochu controlling 49 percent.

It also plans to set up a joint venture with Burns, Philp and
Co to source, process, grind, package, market and export pepper.
(jsk/nur)