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ndustry groups are urging the new government to enact policies to improve the competitiveness of local white sugar production, to meet increasing domestic demand.

Indonesian Sugarcane Farmers Association (APTRI) chairman Soemitro Samadikoen said the new government needed to implement a policy that benefited local farmers and industry.

'€œOur sugar production is insufficient. We should increase our sugarcane cultivation and the performance of our sugar mills,'€ Soemitro told The Jakarta Post on Tuesday.

The APTRI chairman also urged the government to ensure that aging sugar mills were fully replaced rather than repaired, as they had become too old to stay efficient.

Soemitro also suggested that the new government improve harvest quality. Although the local sugar industry had begun to upgrade its harvest quality, Soemitro added the costs were still too high for local farmers to compete with production overseas, where mills were more efficient.

As a result, he went on, imported raw sugar, which was then processed locally into refined sugar, sold better than locally produced white sugar.

'€œThe [Trade] Ministry has actually done pretty well in addressing this. It just didn'€™t cut enough [of the import quota],'€ Soemitro said.

On the last day of his term last Friday, former deputy trade minister Bayu Krisnamurthi revealed that the government might have to further reduce the import quota for raw sugar to 2.9 million tons next year to avoid stockpiling due to lower domestic demand.

Bayu revealed that imports of raw sugar were usually required because of a mismatch between the type of sugar demanded by consumers and that produced domestically. He urged local producers to process the available raw sugar stock into premium quality sugar as compensation, but warned that it would require participation from state-owned enterprises and relevant stakeholders in the sugar refining industry.

Around 3.7 million tons, or 65 percent of total sugar needs, are for premium quality, while only 2 million tons, or 35 percent, are for medium and low quality.

Local producers can only supply 1.4 million tons of premium sugar, while demand is 3.7 million tons, leaving the rest to be met from elsewhere.

Soemitro said refined sugar continued to disrupt the market.

'€œWe now have an excess of 1.2 million tons of white sugar because refined sugar has taken over the market share,'€ he said.

'€œThere should be a monitoring plan in place. The government should simply forbid [refined sugar] from entering the [consumer] market.'€

According to Riyanto Yosokumoro, the secretary general of the Indonesian Association for Refined Sugar (AGRI), the government must focus on developing the troubled domestic sugar market, which produces white sugar to be sold for household purposes and for small industries.

In order to develop the local market, Riyanto said that the government needed to overcome the disparity in production quality within the country, the inefficiency of its handling and distribution, as well as the aging of many production facilities.

'€œThe actual problem is in production, not in trade. There should be close coordination between plantation and factory,'€ Riyanto told the Post via telephone on Tuesday.

Previously, AGRI was blamed for letting the sales of refined sugar bleed into the consumer market, making it hard for the higher-priced white sugar to compete.

'€” JP/Tama Salim