“A market of almost 300 million people is obviously an important one for Canadian producers. That’s why this step in diversifying Canada’s pork export markets is so crucial,” said Canadian Pork Council chair René Roy in a federal news release.

Indonesia has opened its market to Canadian pork and pork products. It will also now accept over-thirty-month bone-in beef and beef offal. Previously, Canadian producers could only export boneless beef.

Indonesian authorities also audited and approved more Canadian meat and livestock facilities.

Canada and Indonesia signed the Canada-Indonesia Comprehensive Economic Partnership Agreement (CEPA) in September. The agreement will eliminate “nearly all” tariffs on Canadian beef and pork, the Feb. 23 news release said.

Indonesia is Canada’s sixth-largest agri-food and seafood export market, the federal government said.

“Indonesia is a dynamic and fast-growing economy,” said Albert Aringfield, vice president of international market development and promotion with Canada Beef International.

“This opportunity strengthens our relationships in Southeast Asia and supports the long-term sustainability and diversification of Canada’s beef sector.”

The federal government said it continues to negotiate export certificates for live breeding cattle, live swine, genetic material and bovine embryos.

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The Comprehensive Economic Partnership Agreement is Canada’s first in the economically crucial Indo-Pacific region since Prime Minister Mark Carney took charge earlier this year with a promise to diversify Canada’s exports away from the U.S.

“I see a lot of opportunities in agriculture, in energy and telecom, in defense and aerospace,” Sidhu said in an interview.

Indonesia a major wheat market

Indonesia was “seriously looking” at Canadian small modular reactors, a new class of relatively compact nuclear reactors, he added.

The bilateral agreement is likely to be ratified by the respective governments within a year or earlier, Sidhu said, adding that Canadian bilateral trade with Indonesia could double within six years.

Indonesia is a small market for Canadian goods and does not feature among its top 10 trading partners. Total bilateral trade between the two countries was just over C$5 billion last year in sharp contrast to the U.S., Canada’s biggest trading partner, where bilateral trade was above C$1 trillion.

Canada’s exports to Indonesia include cereals, oilseeds, wood pulp, fertilizers and machinery, the Government of Canada’s website said. Indonesia is also Canada’s second-largest buyer of non-durum wheat, Cereals Canada said in late 2024, with 2.4 million tonnes bought in 2023.

Indonesia is Canada’s biggest export market in Southeast Asia, giving Canada a gateway to the fast-growing region, Sidhu said.

Canada would look to strike a deal with the Philippines as part of his Southeast Asian outreach soon, he added.

“I will be going to the region quite frequently in the next few months to get that visibility, (and) to have conversations with my counterparts,” he said, noting that other countries on his radar in Asia are Malaysia, South Korea and Japan.

Canada-China ties

Sidhu said he was likely to travel to China in November as part of an increasing dialogue between the two countries to deescalate a trade war that has hurt some critical sectors in both countries.

Carney has been trying to improve Canada’s relationship with China, its second-biggest trading partner, after U.S. President Donald Trump buffeted Canada with a barrage of tariffs.

Carney said on Tuesday he had “constructive” trade talks with Chinese Premier Li Qiang and expected the dialogue to deepen over time.

“We are having this dialogue, this conversation (and) in the past there hasn’t been that kind of engagement. And we want to make sure we are engaged at all levels,” Sidhu said.

He said Canada was also keen to engage with India on broader economic ties, but discussions were at an early stage.

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“This trip is about promoting these products, advancing trade discussions, and building relationships that will create new opportunities for our hardworking producers back home,” MacDonald said in a July 28 news release.

While in the region, MacDonald will meet with senior government government officials, local and Canadian business leaders and other stakeholders. The minister leaves this week and will be in the Indo-Pacific for about a week, a spokesperson for his office said.

The Indo-Pacific is the world’s fastest growing region and home to six of Canada’s top 13 trading partners, the release said.

Canada opened an Indo-Pacific trade office in Manila, Philippines in early 2024 as part of a plan to increase Canadian agri-food exports to the region.

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The Jakarta desk projected yields to improve to 3.26 tonnes per hectare from 3.16 in 2024/25, based on “favourable weather and adequate fertilizer application,” the attaché wrote. Meanwhile, the area harvested is to remain at 14.40 million hectares.

Marketing year exports of palm oil are to bump up one million tonnes at 24 million with China, India and Pakistan remaining the leading export destinations. Of the trio, China and India are the world’s top two buyers of foreign palm oil with Pakistan fourth, according to official USDA data.

The Jakarta desk noted Indonesia’s total domestic use is to nudge higher by 250,000 tonnes at 22.61 million. The country’s increase to a B40 blend this year for biodiesel production will limit the amount of palm oil available for export.

The attaché forecast a boost to ending stocks at 5.29 million tonnes from 4.90 million in 2024/25.

Indonesia is by far the world’s largest palm oil producer, with the official USDA estimate placing the country at 46 million tonnes in 2024/25, almost 59 per cent of global output.

Indonesia is also the leading palm oil exporter at 22.60 million tonnes in 2024/25, which accounted for about 51 per cent of the market. The USDA said the country was tops in domestic use at about 23.33 million tonnes, or 30 per cent of the world’s consumption.

Palm oil is one of the vegetable oils that influence canola futures.

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Indonesia’s program to give free meals to children and pregnant women began this week with 570,000 meals distributed to schools around the country.

This will be scaled up, the government has said, with the target of feeding more than 80 million children and expectant mothers, with an estimated total cost of $28 billion (C$40.3 billion).

Deputy Agriculture Minister Sudaryono said in a statement that out of the 400,000 cows he hoped ranchers would import this year, half should be dairy cows.

In addition to the breeding cows, Indonesia set import quotas of 350,000 heads of cattle for fattening this year to supply the domestic market, agriculture ministry official Imron Suandy said.

In the next five years, Jakarta is targeting to import 2 million breeding cows, so that over time, demand for beef and milk for the school meals programme could be met with local supply, Sudaryono, who goes by one name, said.

The ministry did not say what incentive the government would offer ranchers for the imports.

Indonesia typically imports cattle from Australia and its top source of milk is New Zealand. Authorities have said it was looking into allowing cattle imports from Brazil.

— Reporting by Bernadette Christina

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Sahat Panggabean of Indonesia’s quarantine agency said the highest density of cases were in the provinces of East Nusa Tenggara, North Kalimantan, South Sulawesi and Riau, and urged local leaders to boost awareness and report more cases to authorities.

African swine fever is not dangerous to humans but is fatal for pigs, and can cause massive losses to farmers.

“We provide specific lands to dispose, as well as incinerators to burn the carcasses,” he told a livestreamed weekly meeting of the government, urging communities to avoid throwing infected or dead pigs into rivers.

Panggabean did not provide an estimate for the number of pigs that had died of the disease in Indonesia this year.

He said 6,273 hogs had died of the flu in January in Central Papua province and a further 136 had died there in October. In Papua province there were 220 deaths in February, he said.

Last year, Indonesia reported an outbreak that had killed 35,297 pigs in a herd of 285,034 on the Riau Islands near Singapore.

— Reporting by Dewi Kurniawati

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“This landmark agreement represents a significant opportunity for Canada’s meat industry to expand its presence in one of the largest and fastest-growing markets in the Indo-Pacific region,” the council said in a statement on Monday.

Indonesia and Canada signed the Comprehensive Economic Partnership Agreement (CEPA) on Dec. 2, three years after negotiations began. The agreement will take effect in 2026 and was signed in Jakarta by trade ministers of both countries.

In a joint statement on Monday, the two countries said the agreement, “addresses rules and market access for goods, services, investment, financial services, and temporary movement of natural persons and includes provisions on intellectual property rights, good regulatory practices, e-commerce, competition, government procurement, small and medium-sized enterprises, women’s economic empowerment, environment, and labour.”

The countries also agreed to cooperate on critical minerals, sanitary and phytosanitary measures. Canada committed to providing technical assistance to facilitate the new agreement.

The Canadian Meat Council praised the “robust” sanitary and phytosanitary chapter, which it said will be enforced in such a way as to prevent it from becoming a non-tariff trade barrier.

“It will be essential to ensure that market access requirements, including halal certifications, and industry food safety audits are addressed promptly to facilitate commercially viable access,” the council said.

Cereals Canada was also bullish about the new deal, calling it a “significant milestone for Canada’s agriculture and food sector,” in a statement today.

“With our long history of supplying wheat and durum to Indonesian millers, Cereals Canada was supportive of the negotiations toward an agreement,” said Cereals Canada CEO Dean Dias. “We expect this new agreement to set the stage for future growth and cooperation. The Canadian cereals sector looks forward to continuing our strong ties with Indonesia.”

Cereals Canada highlighted the agreement’s “comprehensive provision on agricultural biotechnology,” and broad tariff elimination for Canadian agricultural exports.

Two-way trade between Indonesia and Canada was $3.4 billion last year, according to with Indonesia’s trade ministry. Canada has estimated bilateral trade at $5.1 billion in 2023.

Canada’s main exports to Indonesia were cereals, oilseeds, wood pulp, fertilizers and machinery, the Government of Canada’s website said. Indonesia mainly exported machinery and electrical machinery as well as garments and footwear.

Indonesia is Canada’s second-largest buyer of non-durum wheat, Cereals Canada said, with 2.4 million tonnes bought in 2023.

Under CEPA, Indonesia will see liberalization of 90.5 per cent of the total tariffs for goods entering Canada with a trade value of $1.4 billion (C$1.97 billion).

Canada’s international trade minister, Mary Ng said the country’s cattle industry was also represented on the Jakarta visit and looking to play a part in Indonesian President Prabowo Subianto’s signature program to provide free school meals from next year.

Asked about U.S. President-elect Donald Trump’s plan to impose 25 per cent tariffs on Canadian goods, Ng told Reuters: “We need to work with the Americans and we’re committed to doing that and that work will certainly continue”.

“The good news here is that Canada and Indonesia in the negotiating of this trade agreement means that we are creating a predictability of our trading relationship, bringing down tariffs,” she added.

—With files from Reuters

—Updated Dec. 4 to include quotes, details from Cereals Canada, updates headline.

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Indonesia currently has a mandatory 35 per cent blend of palm oil-based fuel in biodiesel and is seeking to ramp up to biodiesel containing 40 per cent palm oil to cut its energy imports.

The plan, if implemented, could see biodiesel consumption rise to 16 million kilolitres next year.

The move would involve the additional use of 1.5 to 1.7 million metric tons of palm oil, leading to lower export volumes, Oil World senior analyst David Mielke told a palm oil conference in Kuala Lumpur.

“In a situation where we don’t have enough oil, Indonesia increasing the mandate by five per cent would make overall supply tight,” he told Reuters on the sidelines of the event.

“So for the consumer worldwide, it would be catastrophic because there would be even less oil available.”

B40 will boost Indonesia’s palm oil use for biodiesel to 13.9 million metric tons from the estimated 11 million tons needed this year, with B35, Indonesia’s biofuel producers association APROBI has estimated.

In recent years, global palm oil supplies have been affected by lower output in the world’s two biggest exporters, Indonesia and Malaysia, due to a pandemic-induced severe labour shortage, lower application of costly fertilisers, and persistent rainy weather conditions.

Palm oil production is expected to increase by 2.3 million metric tons in 2024/25 compared to the previous season, Mielke said, with the price of rival soybean oil expected to rise at a premium over palm oil at the latest by June next year.

Glenauk Economics managing director Julian McGill told the event palm oil will likely trade at around 4,000 ringgit (C$1,275.60) per metric ton in 2025.

Malaysia’s benchmark crude palm oil futures FCPOc3 are currently trading at a six-month high. Prices have traded at an average of 3,976.50 ringgit (C$1,268.11) a ton so far this year.

The country’s palm oil production is estimated to come in at 19.4 million tons in 2024, compared to 18.55 million tons in 2023, McGill said.

Indonesia’s production was estimated at 54.84 million tons in 2023, according to the Indonesian Palm Oil Association.

—Updated Oct. 9. Changes attribution of Indonesia production statistics to the Indonesian Palm Oil Association.

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The outbreak that killed 35,297 pigs in a herd of 285,034 on a farm located on Bulan island was detected on April 1 and confirmed on April 28, the Paris-based WOAH said, citing Indonesian authorities.

African swine fever (ASF) is not dangerous to humans but is fatal for pigs. It has plagued China for years, with an initial wave during 2018 and 2019 killing millions of pigs and leading to a dramatic decline in meat output that roiled global markets. China is facing a recent surge in infections this year.

The source of the Indonesian outbreak is still unknown but veterinary authorities told WOAH that humans, vehicles, feed, flies and wild boar may have played an important role in the introduction of ASF on the farm.

The investigation started after the disease was detected by the Singapore Food Agency in imported pigs, they also said.

Indonesia is already up against another major livestock disease outbreak, after foot-and-mouth disease (FMD) turned up there in April last year. The country had previously been considered FMD-free by WOAH since 1990.

— Reporting for Reuters by Sybille de La Hamaide in Paris.

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The country’s USDA post anticipates 46 million tonnes of palm oil production, which would be up from 44.7 during the current marketing year.

The estimate assumes no significant weather events through the remainder of 2022-23. However, a developing El Nino weather pattern for the second half of 2023 could lead to dryness in Indonesia, which would hamper fruit setting and flowering, while lowering palm oil output.

Indonesian palm oil exports are forecast at 28.5 million tonnes in 2023-24, which would be up by only 100,000 tonnes from the current marketing year, with India, China, and Pakistan the major customers.

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