Indonesia to resume poultry exports to Japan after a decade

chicken-thailandIndonesia will begin exporting processed poultry to Japan in few weeks, the first in a decade

Japan had banned Indonesian imports around 10 years ago over avian flu concerns, but agreed to a resumption after a visit by trade delegates to updated facilities on Java island in 2014, according to Nurlaila Nur Muhamad, director of agriculture and forestry product exports at Indonesia’s Trade Ministry.

Global commodities firm Cargill and Indonesian food group PT Indofood Sukses Makmur Tbk, which have announced plans to invest several hundred million dollars in Indonesia’s poultry sector, are aiming to tap a chunk of Asia’s export potential, as well as strong domestic growth.

“The first Japan poultry shipment is now imminent,” Muhamad told Reuters. “We have a chance at exporting to other countries, not only Japan. The first choice is Asia.”

Hit by scares over chicken meat safety in 2014, Japan was reportedly open to further diversifying its poultry supplies beyond China and Thailand, signing an agreement with Indonesia in late August that is expected to be worth up to US$200mn a year.

Japan’s total annual poultry imports were worth US$1.3bn in 2014.

Japanese government officials have confirmed that Indonesian shipments had been given the green light, but were unsure when they would begin. They also noted that fresh meat was not included.

Currently worth more than US$4bn annually, Indonesia’s domestic poultry sector also has plenty of potential to grow as the country eats more meat as the economy expands. Annual per capita consumption currently stands at just seven kg, way behind neighbours Malaysia at 39 kg and Brunei at 48 kg.

“The main reason why Indonesian poultry is very attractive is simply because it’s the largest Muslim country — everybody eats chicken here and they don’t eat pork,” said Henry Wibowo, Citigroup analyst in Indonesia.

Indonesians are seen eating more chickens this year than in 2014, according to analyst, with inflationary pressures at ease after a decision to remove price controls allowed fuel prices to fall.

This move was expected to help boost chicken sales at local companies like PT Japfa Comfeed Indonesia, PT Malindo Feedmill Tbk and PT Charoen Pokphand Indonesia Tbk.

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