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Mills urge government not to import sugar to avoid price drop

Sugar rush: Workers watch a truck unloading sugarcane at PG Blora sugar mills on Monday

Suherdjoko and Alex Tethool (The Jakarta Post)
Blora, Central Java/Kaimana, West Papua
Wed, June 17, 2015

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Mills urge government not to import sugar to avoid price drop Sugar rush: Workers watch a truck unloading sugarcane at PG Blora sugar mills on Monday. The mills are aiming to produce 40,000 tons of sugar this year.(JP/Suherdjoko) (JP/Suherdjoko)

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span class="inline inline-center">Sugar rush: Workers watch a truck unloading sugarcane at PG Blora sugar mills on Monday. The mills are aiming to produce 40,000 tons of sugar this year.(JP/Suherdjoko)

Sugar mills have called on the government to refrain from importing raw sugar during the sugar harvest to allow farmers to enjoy their yields by supplying sugarcane to the mills for a high price.

'€œThe current import of refined sugar fails to consider the condition of farmers, while they are harvesting sugarcane, sugar is being imported. The price of sugar on the market has dropped,'€ PT Gendhis Multi Manis sugar mill (PG Blora) president director Kamadjaja told lawmakers in Blora, Central Java, on Monday.

House of Representatives Commission VI members were paying a working visit to PG Blora.

The national sugar demand amounts to around 5.75 million tons annually, 40 percent of which can only be supplied by sugar mills in Indonesia, and the deficit must be imported from other countries.

In 2014, for example the price of sugar declined to Rp 7,900 (60 US cents) per kilogram due to a surplus of imported sugar. The price of sugar that farmers should have earned was around Rp 9,000 per kg.

Often, when the harvest period arrives, the government suddenly imports sugar and farmers suffer huge losses as the sugarcane price is set low by sugar mills.

'€œWe want farmers to enjoy their yields. If the government does import sugar, the House should propose it takes place in October or November after the sugar harvest has been completed. At the same time, the volume of sugar produced by the sugar mills could serve as a reference to set the volume of imported sugar,'€ said Kamadjaja.

Meanwhile, Central Java Plantation Office head Yuni Astuti said the province was home to 13 sugar mills.

Yuni said the farmers would not face a shortage of farmland given the vast amount of idle land which could be used for sugarcane farms. PG Blora sugar mill has no sugarcane plantation but it is working together with cluster farmers.

Sugarcane farmer Sumarji claimed he was happy to work together with the sugar mill rather than the mill buying residents'€™ land.

'€œFarmers have to survive. I'€™m very pleased by the presence of PG Blora, the only sugar mill in the regency. We sell sugarcane to the mill as it is located close to our farms. The price we get is also very reasonable,'€ said Sumarji.

Sumarji had earned a net profit of Rp 31 million from the canes he supplied from June 2 to 8 and the yields were not from the entirety of his farm. Some 6,000 farmers, cultivating a 4,400-hectare area, supply their harvests to the mill.

PG Blora has the capacity to mill 6,000 tons of sugarcane daily, or equivalent to 4,000 trucks of sugarcane. Its production target this year is 40,000 tons of white sugar.

Separately, the price of sugar in Kaimana, West Papua, has reached Rp 725,000 per 50-kg sack.

Last week, the price of sugar was between Rp 520,000 and Rp 550,000 per sack. Sugar is currently being sold at a retail price of Rp 18,000 per kg, compared to Rp 15,000 earlier.

Sudarman, who sells groceries at the Air Tiba market in Kaimana, West Papua, said he was forced to sell sugar at a high retail price as the wholesale price of sugar continued to rise.

'€œEach time a ship arrives, the price of sugar usually rises by between Rp 1,000 and Rp 3,000,'€ said Sudarman.

Kaimana Industry, Trade and Cooperative Office head Martinus Furima expressed the hope that sugar and other necessities would remain available at distributors.

'€œAlthough prices have increased, residents can still afford to buy foodstuffs as long as stocks are available, especially ahead of the Ramadan Muslim fasting month until Christmas and New Year,'€ said Furima.

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