JAKARTA: Indonesia, Southeast Asia's largest sugar consumer, will not issue any more raw sugar import permits this year as domestic supplies are believed to be sufficient, the agriculture minister said on Wednesday.
Earlier this year, Indonesia issued permits to import 240,000 tonnes of raw sugar to state trading firm PT Perusahaan Perdagangan Indonesia (PPI).
PPI, which had a March-April deadline to use up its permits, only imported 182,000 tonnes, Agriculture Minister Suswono said. Raw sugar has to be processed into white sugar before the government allows it to be sold in the domestic market.
"Although the raw sugar import realization is less than the permits, we will not issue any additional sugar import permits because I assume that the domestic sugar stock is enough to meet our need," Suswono said.
"More over, we will start the sugar cane milling season soon in May." Indonesia does not import white sugar during the May-November crushing season in order to prevent a decline in domestic cane prices, which is likely to anger local farmers.
However, the uncertainty surrounding this year's raw sugar imports spurred domestic sugar prices to climb to their highest levels in more than a year in March.
Indonesia buys about 2 million tonnes each year of raw sugar, or half of its consumption, mostly from Thailand.
In February, Indonesia said it would not import any white sugar this year because it has enough stocks to see it through until its milling season.
The archipelago was the world's second-largest exporter of sugar in the 1930s, but ageing mills, a vast network of smallholders and an influx of cheaper imported sugar have put pressure on domestic production.
Indonesia imported 118,129 tonnes of white sugar last year, from total permits for 450,000 tonnes. The government issues raw sugar import permits allowing shipments between January and the end of April.
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