Wheat importer seeks new supplies

JAKARTA (JP): PT Bogasari Flour Mills, Indonesia's biggest wheat importer, is looking for additional supplies from the United States, Canada and Argentina, following a union boycott in Australia.

"We are looking for alternative supplies in anticipation of a prolonged Australian union boycott," Franciscus Welirang, a company director, told Jakarta Post on Wednesday.

Around 40,000 tons of wheat destined for Bogasari has been stranded in Australian ports following the union boycott that began last week.

The Australian union has refused to load and unload goods to and from Indonesia, to put pressure on the Indonesian government to restore order in East Timor.

Franciscus said the boycott had not affected Bogasari production as it still had supplies to last for two months.

The interruption would not cause any price increases, he said.

In 1998, Australia accounted for around half of Bogasari's wheat imports of 2.7 million tons, with the remainder coming from the United States, Canada and Argentina.

"Australia is the biggest wheat supplier because of its close proximity," he said, stressing that it was not the only supplier.

He said Bogasari, a subsidiary of publicly listed PT Indofood Sukses Mamur, could easily buy wheat from the United States, Canada and Argentina. "This is a commodity that is easily available on the international market," he said.

The United States has been aggressive in raising its stake in the Indonesian market. Last year it exported 600,000 tons, from nil the previous year.

The boycott, seen by market analysts as having the potential to disrupt the company's activities, caused shares of Indofood to fall 5.6 percent on Tuesday to Rp 7,900, and to shed a further in the early trade on Wednesday before closing at Rp 7,900.

Meanwhile, the Canadian Labour Congress called its 58 member unions on Tuesday to boycott goods to and from Indonesia as a protest of violence in East Timor. (02)