Bloomberg News

Cocoa Shipments From Indonesia’s Sulawesi Drop on Local Demand

June 01, 2012

Cocoa-bean exports from Indonesia’s Sulawesi island, the main growing region in the world’s third- largest producer, fell 6.3 percent last month as rising demand from local grinders reduced supplies.

Shipments from South and Central Sulawesi provinces fell to 7,412 metric tons in May from 7,912 tons a month earlier, according to data released by the Indonesia Cocoa Association today. Sales were 15,099 tons in May last year.

Reduced Indonesian exports may stem a 30 percent decline in futures in New York in the past year. The chocolate ingredient is used by companies including Hershey Co. (HSY:US) and Nestle SA. (NESN)

“With the current export duty, it is more profitable to sell to local grinders than exports,” Dakhri Sanusi, secretary general of the cocoa association, said by phone from Bone, South Sulawesi. “Production is also not so good, because the plants are old and farmers don’t take good care.”

Indonesia will keep, for the eight straight months, the tax on cocoa-bean exports in June unchanged at 5 percent, Deddy Saleh, director general of foreign trade at the trade ministry, said yesterday. The base price to calculate the levy will be raised to $2,006 a ton from $1,941 in May, he said.

Exports in the first five months of the year dropped 47 percent to 26,238 tons, the association said. The island of Sulawesi supplies about 75 percent of production and exports.

Cocoa for July delivery fell as much as 1.3 percent to $2,051 a ton on the ICE Futures U.S. in New York today.

To contact the reporters on this story: Yoga Rusmana in Jakarta at; Eko Listiyorini in Jakarta at

To contact the editor responsible for this story: James Poole at

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