Indonesian govt tightens refined sugar imports to protect farmers
Indonesia will tighten refined sugar imports and require importers to develop domestic sugarcane plantations to achieve sugar self-sufficiency within two years. The move aims to protect farmers, curb market oversupply, support local production, and reduce reliance on imported raw sugar through stricter industry compliance.
Indonesia will tighten controls on refined sugar imports and require importers to develop domestic plantations as it seeks to protect farmers, reform the sugar industry and achieve self-sufficiency within two years, Agriculture Minister Andi Amran Sulaiman said.
Speaking in Bandung District, West Java, on Wednesday, Amran said imported refined sugar had flooded the domestic market beyond isolated leakages, depressing prices and undermining the livelihoods of local sugarcane farmers.
“What is happening in the field is that the refinery market is completely flooded. If there is even a small leak, it floods—and sugarcane farmers suffer tremendous losses,” Amran said.
The oversupply has also hurt state-owned companies. PT Perkebunan Nusantara reported losses of about Rp600 billion, or roughly US$33.2 million, after refined sugar displaced its products in the domestic market.
State-owned sugar producer PT Sinergi Gula Nusantara recorded losses of Rp680 billion, or about US$37.6 million, in 2025 due to similar market pressures, State-Owned Enterprises Regulatory Agency head Dony Oskaria said.
At the farm level, molasses prices fell to around Rp1,000 per litre in March 2026 from Rp1,900 previously, cutting values by nearly half.
In East Java, sugarcane farmers threatened a nationwide strike after tens of thousands of tonnes of harvested sugar remained in warehouses pending delayed disbursement of Rp1.5 trillion, or about US$82.9 million, from Danantara covering eight harvest cycles.
The volume of unabsorbed farmers’ sugar has reached an estimated 1.6 million tonnes, exposing growers to potential losses of between Rp4 trillion and Rp7 trillion, equivalent to about US$221.2 million to US$387.1 million.
The marketing crisis triggered protests, including demonstrations in Blora, Central Java, where members of the Indonesian Sugarcane Farmers Association dumped harvested sugarcane outside processing plants during rallies in April and June.
Amran said the government would strictly enforce Agriculture Ministerial Regulation No. 98/2013, which requires sugar processors to own plantations supplying at least 20 percent of their raw material needs.
Compliance has been limited. Of Indonesia’s 11 operating refined sugar producers, only one has met the requirement since 2014, while the remaining 10 depend entirely on imported raw sugar without owning plantations.
Amran said all private sugar companies and importers must comply with plantation development requirements to strengthen domestic supply and ensure local harvests are absorbed.
“All private companies operating in the sugar industry are required to develop their own plantations. The same applies to importers,” Amran said.
“There is no longer any tolerance for those who rely solely on imports without contributing to domestic plantation development,” he added.
The policy has received support from Commission VI of parliament, which oversees trade and state-owned enterprises.
Following a joint meeting in April involving officials from the agriculture, trade and industry ministries and state-owned trading companies, lawmakers endorsed a requirement obliging refined sugar importers to establish domestic plantations.
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Source : Antara News
