More output for Indonesian feed millers

Mills are expected to use around 60 percent of their
capacity this year compared with about 50 percent now and 40 percent in previous
years, said Thomas Bauer, head of Asia food and agribusiness research at
Rabobank.

Indonesia’s feed output was 7.6 million tonnes last year, while
installed capacity is around 15 million tones, Firman Gunadi, secretary general
of the Indonesian Feedmillers Association, told Reuters late on
Tuesday.

“The situation now is more difficult after the fuel price hike.
We are expecting people to consume cheaper animal protein sources like chicken,
not beef or fish,” said Gunadi. About 85 percent of Indonesia’s feed output is
absorbed by the poultry industry. Gunadi said soybean meal imports are likely to
rise to 2-2.5 million tonnes this year from 1.9 million last year. Soybean meal
accounts for about 20 percent of raw material for feed production.

While
soybean meal imports are seen rising, the feedmillers association has projected
corn imports are likely to fall to less than 400,000 tonnes in 2008 due to
higher domestic output.