Sugarcane farmers threaten boycott

Sugarcane farmers threaten boycott

Nana Rukmana, The Jakarta Post, Cirebon, West Java

Thousands of sugar cane farmers in the West Java regency of
Cirebon threatened to boycott the supply of sugar cane to sugar
producers unless the government raised the price of sugar cane,
said the chairman of the local sugar cane farmers' association.

Chairman of the Cirebon branch of the Association of Sugarcane
Farmers (APTRI) Anwar Asmaili said that farmers demanded sugar
mills purchase their sugar cane for at least Rp 3,500 (about 41
U.S. cents) per kilogram.

The minimum price for sugar cane is set by the government,
which has recently proposed increasing it by Rp 150 to Rp 3,250.

"If the demand is not met by the government, they (sugar cane
farmers) will not release their sugar cane into the market until
the government pays the price differential," Anwar said on
Saturday.

He said the threat had come from 35,000 Cirebon sugar cane
farmers, who supply sugar for markets along West Java's north
coast and southern parts.

Without an agreement with the government, he said, the farmers
would retain their sugar cane harvest for this year.

Currently, sugar mills throughout the province purchase
farmers' sugar cane at a minimum of Rp 3,100 per kilogram.

Anwar said that even with an increase of Rp 150 per kilogram,
many farmers would still operate at a loss. He said only sugar
came farmers with a high productivity could survive on the
revised minimum price.

Farmers also agreed on a 20 percent share for the government
if the price of sugar cane in the market exceeded the minimum
price of Rp 3,500, he added.

The government has had difficulties regulating the sugar
industry, facing protests at low sugar cane prices from farmers
on one hand, and steep prices for sugar consumers on the other.

Last year an influx of imported sugar put a strain on farmers
who suffered from a fall in sugar prices.

A new policy restricting sugar importers to four state-owned
companies, from 800 private importers previously, had only led to
a surge in sugar prices among consumers, but not, however, for
sugar farmers.

Government officials have blamed the industry's distribution
channels for the price disparity. Analysts said that it showed
rent-seeking was widespread in the sugar industry.

Anwar said that the West Java administration had offered Rp 5
billion in bailout funds when sugar prices plunged amid the
influx of imported sugar last year.

This year, he said, the administration had Rp 17 billion to
bail out farmers should prices plunge again. So far, he added,
none of the money had been disbursed.