Indonesia revokes beef import ban on Japan to diversify supply

JAKARTA, Aug 22 (Reuters) – Indonesia has revoked a four-year ban on beef and cattle imports from Japan, in a move to reduce dependence on Australian shipments and diversify its supply sources, an official in the Southeast Asian nation’s agriculture ministry said on Friday.

The move follows the announcement this week of talks that will allow the resumption of Indonesian poultry exports to Japan, and after the Japanese foreign minister visited Jakarta last week. Indonesia banned Japanese beef imports in early 2010 following concerns over foot and mouth disease.

Southeast Asia’s biggest economy has loosened its rules on beef and cattle shipments after a beef shortage and corruption scandal last year, and has been looking at alternative importers after a diplomatic spat with its main supplier Australia.

Even before the ban, Japan hardly exported any beef to Indonesia, but the Southeast Asian nation is potentially a new market for its wagyu beef, famed for juiciness and taste, and may help meet the Japanese government’s goal of increasing agriculture-related exports.

Beef and cattle consumption in Indonesia is forecast to rise to 560,000 tonnes in 2014 from 549,000 tonnes in 2013, with around 20 percent likely to be met by imports.

Syukur Iwantoro, director general of livestock and animal health at Indonesia’s agriculture ministry said that following inspections and an audit, all importers are now free to buy from Japanese suppliers.

“The government of Indonesia has opened its market to Japanese beef,” Iwantoro told Reuters. “All Indonesian importers are allowed to import beef and cattle from Japan.

“This will reduce Indonesia’s dependency on Australia because Japanese beef and wagyu cattle is better in quality and cheaper in price,” he said, adding that the latest deal was unrelated to the ongoing poultry talks with Japan.

Japanese officials said that the beef talks with Indonesia were ongoing, with only technical issues remaining to be sorted.
Japan’s government wants to boost exports of agricultural, marine and forestry products to about $10 billion by 2020, from about $4.5 billion in 2012.

Indonesia has been desperate to boost its domestic cattle industries in recent years, and Iwantoro said Japanese cattle breeders may now invest in the country.

Earlier this month, Australia and Indonesia agreed an investment partnership that will focus on improving cattle breeding and logistics for the livestock industry in the archipelago.

Aside from the trade of livestock and poultry, Indonesia’s controversial minerals export ban still appears to be an unresolved and contentious issue for both countries. In February, senior government officials in Japan said the world’s third largest economy was considering taking Indonesia to the World Trade Organisation.

(Additional reporting by James Topham in TOKYO and Gayatri Suroyo in JAKARTA)

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