June 6, 2012

 

Russia desires direct trade on wheat, crude palm oil with Indonesia

 

 

In order to reduce trade cost between the two countries, Russian government wants to have direct trade with Indonesia in wheat commodities and crude palm oil (CPO), an Indonesian minister said on Tuesday (June 5).

 

Indonesian Farming Minister, Suswono, said that Russia has agreed to increase its import on Indonesian CPO commodity, but asked Indonesia to import more wheat from that country.

 

"If we can export and import directly, it will benefit the two countries," the minister said.

 

Indonesia exported 323,000 tonnes of CPO to Russia last year. Russia requires 700,000 tonnes of CPO each year for its food processing industry. That country has been using CPO since 1970 in its food processing industry. Besides from Indonesia, Russia also imported CPO from other countries to fulfil its need.

 

Suswono said that Indonesia has initially set target to improve its CPO export to Russia by 20% next year. Meanwhile, director of farming product processing and marketing director at the ministry, Mesah Tarigan, said that Indonesia will send a delegation led by Coordinating Minister for the Economy Hatta Radjasa to Moscow to discuss trade improvement with Russia on June 25 and 26.

 

He said that Indonesian CPO export to Russia has been conducted through third party in Ukraine. Russia wanted to have direct CPO trade with Indonesia so as to reduce its import cost, he said.

 

He added that Indonesia's need on wheat has been entirely imported from foreign countries, mostly from Turkey. He said Russia has great amount of wheat production, has been exporting it to many countries in which some of them resell it to the third parties.