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Indonesia sugar consumption could rise 12 pct on appetite for sweet snacks
August 27, 2013 / 6:28 AM / 4 years ago

Indonesia sugar consumption could rise 12 pct on appetite for sweet snacks

NUSA DUA, Indonesia, Aug 27 (Reuters) - Indonesian sugar consumption is forecast to rise around 12 percent this year as the country develops a taste for sweet snacks, helping dent the global surplus that has dragged on prices.

Consumption of the sweetener is set to climb to 5.7 million tonnes in 2013 from 5.1 million tonnes in 2012, said Suryo Alam, chairman of the Indonesian Sugar Refineries Association, which groups 11 private millers.

“There’s tremendous growth in the snack industry,” he told Reuters on the sidelines of an industry conference on the Indonesian island of Bali.

“There’s also a growing population, an increase in income per capita and changes in lifestyle.”

Diets in the nation of more than 240 million have been undergoing a creeping westernistaion, with people gaining an appetite for snacks such as doughnuts and fizzy drinks.

At the same time, interest in regional sweet snacks has also been increasing due to a government scheme to promote domestic tourism, Alam said.

Any upturn in demand will eat into a global surplus that helped push prices to a three-year low of 15.93 U.S. cents a pound in July. They last stood at 16.61 cents.

The world’s largest raw sugar importer has abandoned its goal of being self-sufficient in white sugar production by 2014 after struggling to boost output due to land license red-tape, competition for land and under-investment.

The Southeast Asian nation, whose consumption accounts for about 3 percent of global output, imports raw sugar from Brazil, Thailand and Australia.

An official at the Indonesian Sugar Association on Monday said raw sugar imports could more than double to 5.4 million tonnes in 2013 from 2.5 million tonnes last year after heavy rains hit domestic output. Imports for this year were earlier estimated at 2.85 million tonnes.

But some conference delegates on Tuesday said that estimate was probably too high, although they added that demand growth would prompt a hefty rise in imports.

“There’s no doubt consumption is growing quite strongly and above the world average,” said Tom McNeill, director at commodity analysis company Green Pool in Brisbane.

“I think China and Indonesia will be the world’s two largest raw sugar importers for some years to come.” (Reporting by Lewa Pardomuan; Editing by Joseph Radford)

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