Indonesia sugar refining capacity to rise by a third

Indonesia's sugar refining capacity will jump by a third to 4.2 million tonnes next year as three more refineries begin production to try and meet rising demand from the food and beverage industries, an industry group said on Tuesday.

There are now eight sugar refineries in Indonesia, which is set to be crowned the world's top importer of raw sugar in the year to September 2013, with existing capacity of 3.2 million tonnes, Suryo Alam, chairman of the Indonesian Sugar Refineries Association, told Reuters.

"Demand for processed food is increasing," said Alam, who also works at Singapore-listed palm trader Wilmar's Refined Sugars Group Indonesia unit, which runs two Indonesian sugar refineries. Sugar refineries are now running at 70 percent capacity but this figure will slip to 65 percent next year as the new refineries pick up pace, he added. Sugar consumption in Indonesia, the world's fourth most populous country, with around 240 million people, is seen growing around 4 to 5 percent annually and stands at about 5 million to 5.5 million tonnes now. Helping boost this demand is industrial use of the sweetener, with raw sugar consumption by Indonesia's food and beverage industries set to climb by 9 percent this year.