State-Owned Sugar Company Urges for Sugar Import Moratorium

TEMPO.CO, Jakarta - State-owned company Rajawali Nusantara Indonesia (RNI) urged the government to immediately suspend the import of refined sugar to save domestic sugar industry and the prosperity of millions of sugar cane farmers in Indonesia.

CEO of RNI Ismed Hasan Putro, said that there are currently 300,000 tons of sugar produced by RNI sitting in the warehouse because it cannot be sold in the market. The sugar was produced by RNI in the 2013 to 2014 period, which is considered enough to fulfill sugar demands in East Java until 2016. "However, the sugar cannot be marketed because of the large number of imported refined sugar dominating the market for the last two years," Ismed said on Monday, October 13, 2014.

The company is predicted to suffer losses up to Rp 300 billion (around US$24.6 million) this year due to imported refined sugar. The fate of millions of sugar cane farmers who sells their products to state owned sugar producer will also be at stake.

Ministry of Industry M.S Hidayat, said that the suspension of refined sugar imports can be done if it does not cause other industries to suffer losses. "We cannot have the supply of raw materials for the food and beverage industry to become uncertain," he said.

Panggah Susanto, Director General of Agriculture Industries for the Ministry of Industry, said that the request for the suspension of refined sugar imports cannot be fulfilled immediately because currently there are no domestic industries that can produce refined sugar to fulfill the demands of the food and beverage industry.

AMIR TEJO | YOLANDA RYAN ARMINDYA | PRIO HARI KRISTANTO