Despite a sharp drop in molasses prices, all sugar factories in Indonesia continue to operate without disruption, Agriculture Minister Andi Amran Sulaiman confirmed on Friday. Speaking at a press briefing in Jakarta following a meeting with the Lampung Provincial Government and representatives of farmer associations, Minister Sulaiman dismissed concerns over a potential halt in sugar production.
He clarified that molasses, a by-product of sugar production, is not the core issue currently affecting the industry. Instead, the accumulation of unsold sugar stocks had raised alarms about potential production slowdowns.To prevent disruption and support farmers, the Indonesian government has intervened by allocating Rp1.5 trillion through Danantara, a government-backed fund, to purchase sugar directly from farmers. This move is expected to help clear inventory and keep the mills running at capacity.
📉 Molasses Prices Drop Amid Imported Ethanol Surge
While sugar production continues, the molasses market has taken a hit, with prices plummeting from the ideal Rp2,000/kg to just Rp900/kg. According to the minister, this sharp decline is largely due to an influx of imported ethanol, which has saturated storage capacities and reduced domestic demand for molasses.“Storage tanks are full. That’s why the price has dropped so much,” Sulaiman explained.
⚖️ Balancing Stakeholder Interests
Sulaiman emphasized that the government’s priority is maintaining a balanced and sustainable food ecosystem — one that supports farmers, businesses, and consumers alike.
The Ministry of Agriculture will continue to monitor price movements and work with other ministries to develop long-term solutions for stabilizing the national sugar and molasses industries.
📦 Secure Supply Chain Alert
With growing concerns over global sugar markets and fluctuating commodity prices, industry players are encouraged to secure their sugar supplies for the 2025/2026 season — especially from key exporters like Brazil and India.
