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Bogasari ends sorghum program amid supply issues
Bogasari, the food giant owned by the Salim Group, has stopped a sorghum program in East Nusa Tenggara, which had been running since 2013, due to the unstable supply and production problems in the field.
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Indofood Sukses Makmur director Franciscus Welirang poses at the Indonesia Stock Exchange (IDX) building on Tuesday. The food giant has stopped its sorghum business in East Nusa Tenggara due to supply issues. (thejakartapost.com/Anton Hermansyah)
Bogasari, the food giant owned by the Salim Group, has stopped a sorghum program in East Nusa Tenggara, which had been running since 2013, due to the unstable supply and production problems in the field.
Pioneered by former state-owned enterprises minister Dahlan Iskan, the sorghum planting was part of a poverty eradication program in Nusa Tenggara. Dahlan appointed Bogasari as the buyer of sorghum flour as well as the distributor to end-users and food processors.
"How can we distribute it when the production is not sustainable? In one month, there could be one ton of supply, but then we need to wait for the next three months for another ton to be delivered," Indofood director Franciscus Welirang told thejakartapost.com in Jakarta on Tuesday.
Bogasari, which enjoyed a wheat import monopoly along with the State Logistics Agency (Bulog) during the Soeharto era, signed a memorandum of understanding to buy the sorghum yields from farmers as well as from state-owned plantation company PTPN XII in 2013.
But there were problems regarding the price, as PTPN XII tagged a kilogram of sorghum at Rp 3,000, while Bogasari was willing to pay Rp 2,000 per kg.
"With that low price, the plan to substitute wheat with sorghum was just not working. It was cheaper to import the wheat," Franciscus said.
Sorghum flour is a substitute for wheat flour especially in gluten free diets. It can also be processed into sugar and ethanol. Compared to wheat, which needs cold and dry weather to grow, sorghum is easier to cultivate in tropical areas. (ags)
