Sugar Co Reports Rp 680 Billion Loss, Issues Extend Beyond Refined Sugar

JAKARTA, KOMPAS.com - The performance of PT Sinergi Gula Nusantara (SGN), or Sugar Co, has come under scrutiny after recording a loss of Rp 680 billion in 2025. The pressure on the sugar subholding owned by PT Perkebunan Nusantara III (Persero), or PTPN Group, is deemed to stem not only from the proliferation of refined sugar in the consumer market. The issues also relate to management and the structure of the national sugar industry. Refined sugar, which is intended for industrial use, is suspected of entering the consumer market. This situation is pressuring the competitiveness of domestically produced sugar. He highlighted the management performance, which is considered not yet optimal. Sugar Co was established in 2022 through the consolidation of several sugar mills owned by PTPN Group. However, its performance is deemed not to have shown significant changes. The company’s land area is estimated at around 51,000 hectares. This figure is only able to meet about 10% of sugarcane needs. Around 90% of the supply still depends on external parties, particularly farmers. “So, relatively, even though it has been consolidated, its performance hasn’t changed. If Sugar Co’s overall owned land is combined, if I’m not mistaken, it’s only 51,000. Well, that’s approximately what percentage of sugarcane needs—only 10%. The rest is 90%,” said Khudori. At the time of its formation, Sugar Co once offered up to 49% of its shares to investors. However, market interest is deemed not yet significant. Khudori also highlighted changes in transaction patterns at the farmer level since 2020. The outright purchase system has increasingly developed. Farmers sell sugarcane directly to factories and receive upfront payments. This scheme demands that factories have strong financial capabilities. State-owned sugar mills must compete with private ones that can offer higher prices. “Actually, farmers are rational economic beings, so if government policies do not provide certainty or good economic incentives, they will definitely exit from the government,” he concluded.