Indonesia buys up wheat

INDONESIA bought three million tonnes of Australian wheat for the first time last year, cementing itself as our top customer.

It is only the second time in the past two decades that a country has bought more than three million tonnes of Australian wheat in a single year.

The last was in 1996-97 when Iran bought 3.35 million tonnes.

Figures from the Australian Bureau of Statistics show Indonesia bought almost 3.2 million tonnes of wheat in the 12 months to September 30 last year.

Most of the purchases were in bulk, although 184,000 tonnes was shipped in containers and 5000 tonnes as bagged product.

Indonesia has been Australia's No.1 wheat customer every year since taking the mantle from Iran in 2002-03.

CBH Group strategy manager David Capper said Indonesia's big buy last year was partly driven by price, but also a rapid growth in flour consumption in the Asian nation.

CBH Group has a joint venture Asian flour milling business Interflour with the Salim Group.

Interflour owns a number of Asian flour mills, including the Eastern Pearl flour mill in Makassar, southern Sulewesi.

Mr Capper said Indonesian flour consumption had annually increased by 7 per cent over the past 10 years, driven by a population growth of 5 per cent and rising gross domestic product.

But he said last year's record purchase of Australian wheat was also driven by a favourable price differential.

He said Indonesia took 1.3 million tonnes of US and Canadian wheat - much less than previous years.

(Source: http://www.weeklytimesnow.com.au/article/2011/03/11/304281_business-news.html)