With a unique opportunity for growth in the South Asian nation of Indonesia, USW has focused activities on new flour mills opening to meet increased demand for wheat foods as well as existing mills that still dominate the market.
The executives work for Bogasari, which operates four separate flour mills in Indonesia. The company has two mills in Jakarta and Surabaya with a combined annual capacity of around 3.3 million tonnes, Bogasari said.
Bogasari is a business segment of Indofood that produces wheat flour and pasta. In May 2016 Indofood’s Bogasari segment reported sales of Rp4.9 trillion ($373 million), roughly 24% of the company’s total sales. The company’s operations are supported by a maritime unit of five post Panamax and five Handy/Supramax vessels, which are used to transport wheat raw materials from Australia, Canada and the U.S. The group also operates an in-house packaging unit that produces degradable polypropylene bags to support its packaging requirements, the company said.
These managers in quality and product development, production planning and finance will see and hear how U.S. hard red spring (HRS), hard red winter (HRW) and soft white (SW) can help them meet the needs of their growing market, USW said.
“USW has had success demonstrating to Indonesian mills the processing advantages of flour made from U.S. hard red spring and winter wheat for bread products,” said Matt Weimar, USW regional vice-president. “We are also promoting soft white for superior performance in cakes, cookies and other soft wheat products. This visit supports those strategies very well.”
With a unique opportunity for growth in the South Asian nation of Indonesia, USW has focused activities on new flour mills opening to meet increased demand for wheat foods as well as existing mills that still dominate the market. This effort paid off as the mills and their customers recognized they could get good value and differential quality from U.S. HRS, HRW and SW, USW said. Indonesia increased HRS imports from about 100,000 tonnes in marketing year 2008-09 (June to May) to more than 500,000 tonnes in 2013-14. Imports of SW nearly doubled over the same time to more than 480,000 tonnes. Bogasari, which once only milled wheat from Australia, is now one of Indonesia’s largest HRW importers, taking whole Panamax size cargoes of 70,000 tonnes. Bogasari continues to control between 55% and 60% of the expanding Indonesian market, that is an important breakthrough, USW said.
In 2015-16, total U.S. wheat exports of HRS, SW and HRW to Indonesia totaled about 22.3 million bushels (608,000 tonnes), which boosted income for wheat farmers and the U.S. wheat supply chain primarily in North Dakota, Montana, Idaho, Washington and Oregon, USW said.
Funding for the trade team visit comes from the U.S. Department of Agriculture (USDA) through its Foreign Agricultural Service (FAS) export market development programs and from in-kind contributions from the Montana Wheat and Barley Committee, the Idaho Grain Commission, the Washington Grain Commission, the Oregon Grain Commission and the Wheat Marketing Center in Portland, Oregon, U.S.
The team will start its visit in Fargo, North Dakota, U.S., with the North Dakota Wheat Commission, North Dakota State University and Northern Crops Institute focusing on the advantages of HRS and the on-going work to improve functional performance. Next is a visit to Greg Svenningsen’s farm in Valley City, North Dakota, and a country elevator owned by Columbia Grain before the team flies west to Portland, Oregon, U.S. The visit there and then back up-country to eastern Washington and northern Idaho provides a complete picture of the U.S. Pacific Northwest wheat supply system and a detailed look at SW advantages, USW said.
“With U.S. wheat at a price disadvantage compared to Canadian wheat the last couple years and with Australia’s strong influence with Indonesia nearby, it is important to bring top-level managers from a large mill like Bogasari that has a majority market share to the United States to put a face on our advantages,” Weimar said. “It makes a difference when the buyer meets the breeders, farmers and grain handlers who actually make U.S. wheat the world’s most reliable supply.”