RI seeking to re-export huge quantities of rice

RI seeking to re-export huge quantities of rice

SINGAPORE (Reuter): Indonesia, faced with growing rice supplies, is seeking to re-export some of the huge quantity of rice it imported last year, especially from India, but traders said yesterday that there were few buyers around.

Indonesia, a significant rice producer, turned to imports in late 1994 after adverse weather conditions hit domestic harvests. The government put the purchases at 2.0 million tons in the 1995/1996 fiscal year ending this month.

But local harvests have now returned to normal, swelling rice stocks at National Logistics Agency (Bulog) to two million tons in late February from 1.8 million earlier in the month.

A trader at a Singapore firm said he heard Indonesia was attempting to re-sell "hundreds of thousands of tons" of Indian rice to West Africa.

But a major Bangkok trader said no deals had been concluded yet. "They want to re-export but there are very few interested buyers," he said, adding that the exportable volume was estimated to be around 200,000-300,000 tons.

Traders said the other factors behind Indonesia's attempts to re-export were the low quality of the Indian rice and the problem of obtaining storage space for the grain.

The bulk of the Indian rice, drawn down from New Delhi's substantial government stockpile, was shipped to Indonesia between January and October last year.

"Despite the quality, the Indonesians initially accepted the rice because they had no choice.

"But towards the last quarter of last year, they started rejecting the same rice because of the quality when they realized they had sufficient stocks," he said.

The rice is still edible but traders said one option is to turn it into animal feed to help cut possible losses.

Jakarta had committed to buy up to two million tons of Indian rice last year. Traders said they were not sure how much of that rice was delivered but added that the deals which were canceled involved cargoes that were not loaded or delayed at Indian ports.

The Indonesian rice harvest, which started in some parts of Java in February, is expected to go into full swing this month. Indonesia produced 49 million tons of unhusked rice in 1995, compared with 46.4 million in 1994 and 48.14 million in 1993.

Bulog chairman Beddu Amang said last month that rice imports were continuing to arrive and the agency was facing problems in obtaining storage space.

"We have enough warehouses to store the rice we will be buying from the farmers when the harvesting season comes. Our problem is how to store the rice imports landing at the major ports," he said.