Sugar Council sweet on imports

Sugar Council sweet on imports

Zakki P. Hakim, The Jakarta Post/Jakarta

The Indonesian Sugar Council (DGI) has suggested that sugarcane
farmers start harvesting their cane in mid May, a two-week delay
from the initial date, to allow more time for listed importers to
meet their sugar import quotas, says Minister of Trade Mari E.
Pangestu.

"The council has suggested the delay, but no specific date has
yet been determined as to when the sugarcane crushing season
officially starts.

"It could even be later than mid May," Mari told reporters
late on Thursday.

The government reopened sugar imports in December last year,
granting four state-owned companies permits to import up to
300,000 tons of sugar.

However, with domestic sugar consumption on the rise, the
government early this month allowed the importation of an
additional 200,000 tons. The four firms currently holding sugar
import permits are plantation companies PTPN IX, PTPN X and PTPN
XI, and trading and manufacturing company PT Rajawali Nusantara
Indonesia (RNI).

Since 2002, the government has limited the number of sugar
importers in a bid to help protect the interests of local
sugarcane farmers who cannot compete against much cheaper
imported sugar products.

The government bans the import of white sugar one month before
the crushing season, coinciding with the day local farmers start
harvesting, and re-opens imports about five months before the
season.

Therefore, based on the sugar trade rules, the importers --
who will only get four months to import sugar -- can bring in
sugar as late as March, as local farmers usually harvest their
cane starting early April.

The Council's suggestion means that harvesting could be pushed
forward to mid April.

Elsewhere, in anticipation of recent fuel price increases,
Mari said that the council had suggested an increase in the
minimum price of sugar received by farmers from the current Rp
3,410 (37 U.S. cents) per kilogram.

Sugar factories are required to buy local sugar from farmers
using the determine minimum price as the starting rate.