JAKARTA, INDONESIA — Indonesia’s wheat imports are expected to grow modestly in 2019-20 to 11.3 million tonnes, up from 10.78 million tonnes a year ago, according to a report from the Foreign Agricultural Service of the U.S. Department of Agriculture (USDA).
Demand from feed mills is expected to decline slightly from 2.1 million tonnes to 2 million tonnes due to the increased availability of corn.
“Feed mills continue using wheat as a compliment to other feed ingredients, creating steady demand for feed wheat imports,” the USDA said.
The nation, which is completely reliant on wheat imports, has 28 flour mills with installed capacity of 11.8 million tonnes per year. Running capacity of the mills reached 80% in 2017-18, an increase from 70% in 2016-17. At the beginning of 2019, industry expected growth of 5% in 2018-19, in line with the estimates of overall economic growth.
U.S. wheat exports to Indonesia reached a record high in 2018-19 with a total volume of 1.373 million tons, an increase of 29% compared to the previous period, the USDA said.
Ukraine was the largest supplier of wheat to Indonesia in 2018-19 with 24% market share, followed by Canada (22%), Argentina (18%), the United States (13%), Australia (11) and Russia (9%).
Corn harvested area in 2019-20 is expected to increase to 3.9 million hectares with some farmers switching to corn over paddy.
Because of the increased area, overall production is estimated at 12.7 million tonnes.
Feed production is estimated to reach 22.4 million tonnes in 2019 and forecast to grow by 5% in 2020.
“In line with expectations for continued growth in poultry feed demand, 2019-20 corn consumption for feed is forecast to increase to 9.5 million tonnes compared to 9 million tonnes in 2018-19,” the USDA said.
Consumption for food, seed, and industrial use is forecast to increase to 4 million tonnes as corn wet mills are expanding running capacity to fulfill more demand for corn starch, maltodextrin and corn syrup.