Indonesia sees higher sugar, rice output in 2011

Indonesia expects production of white sugar to increase by nearly 70 and rice by a more modest 4.3 percent next year on the back of improving yields and expanded acreage, the agriculture minister said on Wednesday. Prolonged wet weather this year reduced production of the country's key agriculture commodities and forced south-east Asia's biggest economy to import rice and white sugar to bridge an anticipated shortfall.
Indonesia expects to produce 3.87 million tonnes of sugar next year, up from a downward revision of 2.3 million tonnes this year, agriculture minister Suswono told an end-of-year news conference. "Rains have sharply reduced sugar content this year leading to lower production, but we will work hard to achieve self-sufficiency in sugar by 2014," said Suswono.
Indonesia, south-east Asia biggest sugar consumer, was the world's second biggest producer after Cuba in 1930s, but capacity fell because of a combination of ageing sugar mills, an influx of cheap imports and low productivity from a vast network of smallholders.
The government will spend 103 billion Indonesian rupiah ($11.4 million) next year to boost sugar production from just 15.2 billion this year, said Gamal Nasir, director general of plantation crops. "We will do replanting, expand sugar cane plantations and improving seedlings," said Nasir.
The expansion of paddy fields and the use of high-yielding seeds are expected to boost the country's rice production to 68.8 million tonnes of unmilled rice in 2011, up 4.3 percent from an estimated of 65.98 million tonnes for this year, the agriculture minister said.
The minister did not say whether higher production would lead to less rice being imported next year. Bulog, the state procurement agency, has secured a total of 1.33 million tonnes of rice from Thailand and Vietnam this year for a delivery until February 2011. Indonesia also expects corn production to reach 22 million tonnes next year, from an estimated 17.84 million tonnes this year. The country's soybean production is expected to increase by 11.59 percent to 1.01 million tonnes, from an estimated 905,020 tonnes, said the minister.