Sugar Stock Enough until Next Milling Season: AGI

Surabaya, East Java (Antara) - The Indonesian Sugar Association (AGI) said the country's sugar stock carried over from 2013, is enough until the next milling season in May. Senior Adviser to AGI Adig Suwandi said here on Wednesday in the past three months sales of sugar from local sugarcane totaled only 300,000 tons that there were still 935,197 tons in stock. "That means that sales of sugar from local sugarcane averaged only 100,000 tons per months much lower than normally 220,000 to 275,000 tons per month," Adig said. The low market demand indicated that the domestic market had been saturated, he said. Illegal sales of double refined sugar in the open market caused a decline in demand for cane sugar. Double refined sugar is not allowed to be sold to the open market as it is only to be used for industrial feedstock mainly for food and beverage processing industry. He said two sugar factories in North Sumatra started milling in February , to be followed by six other factories in Lampung and one in South Sumatra in April. In Java most sugar factories are expected to start milling by the end of May or early June that sugar stock would be more than enough, he said, adding import would not be needed. "The plan of the Board of Logistics (Bulog) to import 350,000 tons of sugar is needed. "Even if Bulog, as a price stabilization agent, has to increase its stock it could buy sugar from local producers at a market price," he said. He called on the government to take firm measure against illegal sales of double refined sugar to the open market. He also said the all producers of double refined sugar should have sugar plantation to reduce dependence on import of the raw sugar as the basic material "Sanctions should be effective to deter violation of the regulation . The sanction should be firmer than just to cut import quota for the producers found guilty of selling double refined sugar to the open market," he said. The government should protect sugar farmers and at the same time reduce current account deficit as a result of large imports, he added. He said there are two million sugarcane growers in the country that need government protection. He said even in advanced nations like the United States, Europe and Japan and other major sugar producers in the world , sugar farmers are protected by the government. Protection could be in the form of subsidies including price subsidy , export subsidy , import restriction , high tariff barrier, he said. (*)