TEMPO.CO, Jakarta – Indonesia says it is ready to export fertilizer, leveraging the disrupted global distribution following the war in the Middle East. “We are planning to stock up this year and export a total of 1.5 million tons of fertilizer,” said Deputy Minister of Agriculture Sudaryono in a statement in Jakarta on Friday, as quoted by Antara.
One-third of the world’s fertilizer distribution passes through the Strait of Hormuz and most of the supply comes from the Middle East region. Meaning, disturbances in the Hormuz waterway have triggered a supply crunch, leading to various countries seeking urea fertilizer supply from Indonesia.
“We are one of the largest urea producers in the world,” he said.
A number of countries have spoken with the Indonesian government about this, including India, Philippines, and Australia, according to Sudaryono.
“The Indian government has contacted us. I have also received a letter from the Philippine and Australian governments. They are ready to buy at any price,” Sudaryono said.
Indonesia has now canceled the plan to close several domestic fertilizer plants, following the broader export opportunities due to growing global demand.
Over the next year, Sudaryono said that Pupuk Indonesia Holding Company (PIHC) is targeting the export of 1.5 million tons of fertilizer. However, the government also ensures that fertilizer for domestic farmers remains the top priority before exporting.
“We will not tamper with that,” said Sudaryono, who is also the Chair of the Indonesian Farmers Association (HKTI).
The previous plan to export urea fertilizer was conveyed by the CEO of PT Pupuk Indonesia (Persero), Rahmad Pribadi. He mentioned that the national urea fertilizer production capacity reaches 8.8 million tons operationally, even though the installed capacity is 9.4 million tons.
The global urea price has now risen from around US$400 per ton to US$800 per ton. Meanwhile, Indonesia remains unaffected since its domestic production meets most of the demand.
Regarding export quotas, Pupuk Indonesia cited around 1.5 million tons to export, but said it remained subject to change depending on domestic supply conditions.
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