Corn import ban likely to increase poultry and egg prices in Indonesia

The Indonesian Poultry Farmers Association (IPFA) has warned of an increase in wholesale poultry and egg prices due to the country’s recent move to stop imports of corn for feed mills.

The country implemented a ban on corn import as an attempt to become self sufficient. Indonesia primarily imports corn from Argentina and Brazil.

According to critics, corn demand has seen an upward growth trend in recent years due to increasing wealth and a rise in poultry demand. However, blocks on imports could lead to inflation.

Voicing his concern about the move, IPFA chairman Hartono said: "This policy has good intentions, but it was too sudden, without any preparation. This three million tonnes of corn per year can provide jobs for so many people here."

Reuters had previously quoted trade ministry data which revealed that the price of home-grown chicken had increased by around 6%, in comparison to the previous year’s $5 per kg.

Indonesian president Joko Widod has been on a drive to attain self-sufficiency, a move that is pegged as the primary cause for theshutting down of the sugar refinery and the increase in food prices.

After the ban was declared, local corn dealers had spiked the prices of their produce to be sold to breeders by 10%.

Hartono further said that the move would only be beneficial for brokers.

The curb will also lead to relocation of mills from corn to more expensive substitutes like wheat and palm kernel which will lead to a rise in the price of poultry.