February 26, 2004

Indonesian Soymeal Demand To Fall By 12% Due To Bird Flu

Indonesian soymeal consumption is expected to fall around 12% due to the bird flu outbreak that slowed both poultry and animal feed production, a senior industry official said Wednesday.
 
Budiarto Subijanto, chairman of the Indonesian Feedmillers Association, said Indonesian feedmills usually consume 650,000 metric tons of soymeal each month. However, he estimated that for the month of February, soymeal consumption will drop to about 570,000 tons.
 
"Poultry meat consumption is going down because of the bird flu outbreak. People are afraid to eat chicken meat," he said.
 
Indonesia produces around 7 million metric tons of compound feed, 90% of which is used in the poultry sector. Soymeal comprises about 18% of the animal feed formula.
 
But the bird flu virus, which ravaged poultry farms not only in Indonesia but other Asian countries as well, pushed down production of poultry meat and, consequently, demand for feeds, he said.
 
This has led to lower soymeal consumption and imports, he said.
 
Budiarto said a big feedmill, that can produce more than 100,000 tons of compound feed each month, usually contracts about 100,000-130,000 tons of soymeal for each shipment. The shipments are generally consumed over a period of four months. He said most of these are long-term contracts.
 
But, due to the uncertainties caused by the bird flu virus, feed mills are just importing on a hand-to-mouth basis. A large feedmill, he said, will just contract 30,000 tons of soymeal per shipment, which is generally consumed over one month.
 
Indonesia, one of the world,s biggest importers of feed ingredients, imports most of the soymeal it consumes. Annual soymeal imports are pegged at about 1.4 million tons.