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.