Indonesia’s Import Regulation Snags Deplete Industry Raw Materials

The Indonesian Flour Producers Association, known as Aptindo, has warned that flour producers, including Indofood and Wilmar, face a threat of running out of raw wheat flour materials. Domestic wheat production is at risk of halting in the second quarter of this year. Aptindo Chairman Franciscus Welirang explained that Minister of Trade Regulation No. 36/2023 has made it difficult for businesses to import Fortified Premix, a substance that provides micronutrients to wheat flour.

According to Aptindo data, PT Indofood Sukses Makmur Tbk will run out of Fortified Premix in April, while five other wheat flour producers will run out in May. These five producers are PT  Sriboga Flour Mills, Cerestar Group, Wilmar Group, PT Eastern Pearl Flour Mills, and PT Golden Gran Mills. Meanwhile, PT Bungasari Flour Mills will run out of Fortified Premix in June.

"Under Minister of Trade Regulation No. 36/2023 and Minister of Trade Regulation No. 3/2024, the import of fortified premixes must obtain PI [Import Approval] and LS [Surveyor Report]. However, in practice, the technical regulations are not yet available [delayed]," Franciscus told Katadata.co.id on Thursday, Apr. 18.

Previously, Chairperson of the Indonesian Employers Association (Apindo) Shinta W. Kamdani warned of potential business losses in nearly all subsectors of the national manufacturing industry. This is because the scope of import restrictions in the Minister of Trade regulation is extensive, reaching up to 70 percent of the total Harmonized System (HS) of traded goods. Meanwhile, regarding the technical rules issued, import licensing procedures for the concerned goods are complex and convoluted. "Many industries have stated that they are threatened with ceasing production if there is no further adjustment to implementing these policies," she said.