Taiwanese agriculture firms to relocate to Indonesia

Taiwanese agriculture firms to relocate to Indonesia

TAIPEI (JP): Several Taiwanese agriculture-processing
companies are looking for opportunities to relocate their plants
to Indonesia, visiting Industry and Trade Minister Rahardi
Ramelan said on Saturday.

Rebar Group-Chia Shin Food and Synthetic Fiber Co., Ltd.,
which operates cooking oil factories, flour mills and processing
plants for other commodities, plans to move its plants to
Indonesia to follow the Taiwanese government's "southbound"
policy.

The Taiwanese government, Rahardi said, has instructed
Taiwanese companies involved in labor intensive and low-
technology work to relocate their plants to other countries.

"The companies plan to move their cooking oil plants to
Indonesia. They asked me which Indonesian province would be most
suitable for them to develop their vegetable oil factories," he
said after his meeting with Taiwanese food companies.

"So, I suggested they relocate to Medan, North Sumatra,
because the area is the main producer of crude palm oil. They
could develop a cooking oil company there using CPO produced in
Medan and sell it to the domestic market," he said.

Leader's Coffee, a coffee packaging company, also plans to
develop a factory in Indonesia.

"Leader's Coffee is not a big company, but its production, in
terms of iced coffee products, supplies all fast food outlets in
Taiwan," he said.

Leader's Coffee and Indonesian coffee exporter PT Gemilang
Sentosa Permai signed an agreement in which Gemilang will export
coffee to Taiwan to supply Leader's.

Gemilang's director Rudy Soekoyo said his company, based in
Malang, East Java, would deliver 500,000 tons of coffee beans and
processed coffee annually to the Taiwanese company.

"The amount is quite large because it accounts for 20 percent
of Taiwan's total coffee imports of 2.5 million tons annually.
The coffee will be shipped gradually," he said.

He refused to state the value of the export contract.

Earlier last week, Gemilang also signed contracts to supply
two Japanese coffee processing companies. Under the contracts,
Gemilang will export 100 tons annually to the two Japanese firms.

Rahardi also said he had invited the Taiwan Sugar Federation
to cooperate with its Indonesian counterpart in establishing
joint sugarcane plantations in Sumatra and other areas in
Indonesia.

"Sugar is highly protected in Taiwan, because the government
wants to protect sugar farmers. However, Taiwan's sugar
production is decreasing every year due to declining sugarcane
plantation areas. On the other hand, domestic demand is
increasing," he said.

Sugar produced by the proposed joint sugarcane plantations
could be exported to Taiwan and sold to the domestic market, he
said.

The molasses produced by the proposed joint sugar mills could
also be sold to Taiwanese Monosodium Glutamate (MSG) producers,
which are in short supply of molasses as an MSG raw material, he
added. (gis)