MANILA, Philippines — The 80-members of the Filipino-Chinese Bakers Association (FCBAI) is planning to directly import flour from Indonesia amid the continued high costs of locally-milled flour.
FCBAI former President Benito A. Ong, recently in Indonesia visiting the facilities of PT Eastern Pearl Flour Mills, the world’s fifth biggest flour miller, said that it has been 10 years since the organization was importing flour by the bulk and they plan to resume shipments as soon as first quarter of 2012.
“We stopped importing flour 10 years ago when local millers started supplying more of our demand domestically,” said Ong whose bakeshop, Bakers’ Fair & Foodmart Inc., was one of the oldest in the country. Before the 1990s, there were only eight millers and now there are 12.
“We may import directly from Indonesia because having seen the facilities, we see that the quality is near and good as the best premium brand that the locals can produce. I have a firsthand observation now that the quality is good and they use the US wheat and that’s exactly what we use,” said Ong.
At the moment, FCBAI members buy imported flour from Malabon Long Life, which ships flour from Indonesia and Turkey. Businessman Ernesto N. Chua, who currently imports 50 containers of flour a month from EPFM Indonesia, is targeting to raise this volume to 200 containers next year via his trading firm, Malabon Long Life.
For the Filipino-Chinese bakers, Ong said they could begin importing a small volume first, about 10 containers per week as early as the first quarter next year. The flour that EPFM produce, from the US’ DNS wheat, Canadian and Australian wheat, matches the exact quality that most FCBAI members are looking for. Indonesian flour is sold for P830 per 25-kilo bag compared to local millers’ P900 to P930 per 25-kilo bag.
Ong said the local baking industry is not as large as before. The current number, according to Philippine Baking Industry Group President Simplicio Umali Jr. is that there are 14,000 licensed bakeries, not including outlets. In the last decade, 8,000 bakeries have shut down mainly because they could not keep up with the new technologies and the rising prices of wheat flour. FCBAI in fact used to have 120 members and now they are down to 80.
Umali, also President of the P3-billion Gardenia Bakeries Philippines Inc., said once product registrations are approved, they will import flour direct from Indonesia by next month.
Umali said the Food and Drug Administration has already evaluated the special flour blend that EPFM will produce for Gardenia. “It meets the high quality of flour that we require for our equipment. We will bring in a few loads of container, about 10 per week, and then later increase the load in the coming months.” A 10-container load is equivalent to 200 metric tons of flour a week. The entire baking industry has a requirement of two million metric tons of flour per year and only 10 percent of this supply is imported.
Walter Co., President of Creative Bakers Company the maker of Walter Bread, said they too may start using imported flour, particularly EPFM’s brand.
“We are interested in using Indonesian flour but not 100 percent. The effect is that it will offset some of the increase in production costs because we are expecting an increase and we have been trying to hold it off for some time,” said Co. “Cheaper flour from imports will be good. We’re not using Kompas (EPFM brand) yet but after seeing the facilities, we might use it.”
EPFM, the second biggest flour miller in Indonesia, is jointly owned by CBH Australia and Salim Group of Indonesia. It operates a four-hectare flour mill plant in Makassar, Indonesia, producing 552,000 metric tons of flour or 22.08 million 25-kilo bags per year. Its annual sales turnover averages $270 million.
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