GOVT TO CUT QUOTA OF ERRANT REFINED SUGAR PRODUCERS

By Andi Abdussalam

Jakarta, June 18 (ANTARA) - Indonesia's sugar production is predicted to meet only  50 percent of domestic demand, including demand from  food and beverage industries so that imports are necessary to cover the balance.          Yet, the importation of sugar is a source of annually recurring problems that occur particularly when the government is about to import the balance. The root of the probllems is usually a conf;ict of interest  between sugarcane growers and consumers.          Refined sugar which should be used by food and beverage industry also always poses a problem as it is allegedly often leaked to the retail market.          The House of Representatives (DPR) has planned to summon the trade minister to ask for the government's plan to import over 224,000 tons of sugar.          In the meantime, the government has also threatened to give sanctions to refined sugar producers which leaked their products to the consumption markets.          "Producers will be fined directly if they leak their refined sugar to the retail markets. They will have their import quota reduced," Director General for Internal Trade Gunaryo told a hearing of the House's Commission VI on trade affairs.          The director general made the statement in response to complaints that refined sugar which is designed for industry had sometimes entered the retail markets.       "The circulation of refined sugar for industries in the retail market disturbs farmers' sugar because it is sold at a lower price. We urge that the circulation of refined sugar should be put in order based on regulations," Chairman of the Indonesian Canesugar Farmers Association (APTRI) Arum Sabil said last month.          He said this could have happened because production of refined sugar exceeded the need of food and beverage industries. The remaining then entered the consumption market.         To respond to the sugar farmer's complaint, the government will take sanctions against refined sugar producers who are proved to have leaked their sugar to domestic market.          The government also called on refined sugar producers to discipline themselves and supply refined sugar only to food and beverage industries in accordance with  existing regulations so as  not to disrupt the  crystal or consumer sugar market.          "We have summoned eight refined sugar producers and asked them to call themselves to order so that no refined sugar will enter the consumer sugar market," Gunaryo said.          Gunaryo said that the trade ministry had met with all stakeholders in the production and distribution of refined sugar. It has also set up a task force to monitor refined sugar distribution so that it would not enter the retail market.         The task force is a means of all stakeholders involved in the monitoring of refined sugar distribution.  "This forum will have a routine meeting to evaluate sugar distribution in the country," the director general said.          Besides, the trade ministry will also conduct a periodic monitoring to a number of provinces.          With the supervision and monitoring it is expected that refined sugar would not be sold at the consumption markets as the association of sugarcane farmers and crystal white sugar producers have complained about.          The government has also asked producers to assign distributors and sub-distributors. "We ask them to assign distributors where each of the distributors is required to sign an integrity pact to make sure that there would be no refined sugar leaked to the retail market," the director general said.          Secretary General of the Indonesian Refined Sugar Association (AGRI) Suryo Alam said his side was ready to help monitor the distribution of the refined sugar.          This year, he said, the government allowed the importation of 2.4 million tons which after a process would only amount to about 2.2 million tons. The need for refined sugar of industry this year is estimated at between 2.2 million and 2.3 million tons.          So, Suryo said, it is unlikely for refined sugar to enter the retail market because the government only allowed the importation of raw sugar based on the volume needed by industries.          Yet, the government's plan to import sugar to meet sugar shortage is always questioned. As the government is planning to import some 224,200 tons of raw sugar, the House of Representatives is also planning to summon the trade minister, Mari Elka Pangestu.         "I will encourage the House Commission IV to summon the trade minister to ask whether or not the planned sugar imports will harm the public's interests," House Speaker Marzuki Alie said  this week.          Marzuki said he believed the House Commission IV overseeing agriculture; forestry and plantation had complete data on the planned sugar imports.          The House Commission would ask whether or not the sugar imports were necessary and whether or not they would harm the public's interests because the plan was closely related to low-income people, particularly sugarcane growers, he said.          The government has allowed the trade ministry to issue permits for the import of 242,200 tons of raw sugar. The import sugar will be allocated to seven companies that have secured permits to import raw sugar. ***5*** (T.A014/A/HAJM/19:55/a014) 18-06-2011 19:55