Indonesia aims for poultry self-sufficiency
Indonesia, the world’s fourth most populous country and the largest economy in Southeast Asia, has self-sufficiency goals for poultry and beef.
Protectionist policies on poultry (de facto ban on imports) and beef (import quota) are major trade barriers, while domestic production struggles to keep up with demand, according to a recent USDA International Egg and Poultry review.
Indonesia’s per-capita consumption of beef and poultry is well below neighboring countries and the expanding middle class points to strong growth potential. The country’s total poultry consumption is expected to double in 10 years.
Indonesia is an important market for US feeds and fodders. US exports have nearly doubled in just five years, led by corn gluten meal, meat and bone meal (MBM), distillers dried grains with solubles (DDGs), and prepared poultry feeds. The Indonesian poultry sector accounts for over 80% of total feed demand.
Feed mills rely heavily on imported feed ingredients, especially protein meals, additives, and DDGs, for which US supplies are competitive. Indonesia is the largest market for US MBM. Recent trade restrictions on US MBM are expected to be temporary, as the country simply cannot supply enough feed for its bourgeoning poultry sector.
Indonesia has one of the highest growth rates in retail food and beverage sales among developing countries. While traditional retail venues, such as wet markets and small food stalls, still account for 85% of grocery sales, modern retail stores have been growing much more robustly, expanding share of grocery sales from 5% in 1999 to 15% in 2011. The number of modern retail outlets increased 13% in 2011 alone, as many start to reach second- and third-tier cities.
Modern retail outlets are well suited for introducing imported products, including perishable items and high-value consumer-oriented products. Chicken meat could become a major US export if Indonesia lifts its de facto import ban.
