The Indonesian Government's fruit import quotas are prompting executives to start new companies in a bid to increase volume, but the restrictions still force traders to act like weather forecasters with expectations they lock in import estimates months before fruit has even set.

This is the message of Hendra Juwono, a spokesperson for the Indonesian Fruit and Vegetable Exporter and Importer Association (Aseibssindo), in conversation with www.freshfruitportal.com.

"With the quota system it’s making it extremely difficult and in smaller quantities, and we're not able to maneuver to buy the product from different origins because the quota is for a very specific fixed quantity, variety and country of origin," Juwono said.

"They give you too much notice, that’s the problem. The quota system is for every semester, for six months, so you have to plan seven or eight months ahead of the season.

"Trying trying to read the world’s weather system and forecast eight months ahead is near enough impossible. So it’s a losing battle for Indonesia itself."

The government's reasoning behind the quotas is to promote local producers, but Juwono said the policy was not having the desired effect and also made food more expensive for consumers.

"The local farmer is not being supported by the government properly so quantity-wise there’s not enough product there.

"Those who suffer out of this are the consumers – they can buy the same product, but at double the price."

As an example, Juwono mentioned Indonesia could have absorbed some of Europe's excess apple stock that came about following the Russian ban,

"Eight months prior you didn’t know anything about it and you wouldn't have had the quota for European apples, so you can't import can you?

"Import demand for fruit is still strong but the problem is there is a limited quantity because of the quota. But there is a way around getting the limitation of the quota – people just keep on opening new companies.

"So at the end of the day, they’re not limiting the quantity, they’re just making it difficult for the importers and the consumers because of the high pricing."

But is that practice legal?

"Of course it’s legal. Can anybody stop you from having one company? One person can own 200 companies if they want."

He said citrus was the fruit category most impacted by the measure, in Navel oranges, Valencia oranges and mandarins.

"It’s not only about limiting the quota, but now they also are implementing a specific timeframe for importation - for orange like Valencia and Navel they can only be imported for arrival in February and March in the first semester, and then September and October in the second semester; so you have a total of four months out of the year," he said.

"Mandarins can only be imported from January to April, and then from September to October," he said, adding Australia and South Africa were the export industries most affected in this crop.

He said there were some positives to be found in the market, but in the end it wasn't just the import sector losing out but exporters too.

"The market is still growing, consumption is still growing, buying power is still growing," he said.

"In addition, we are losing a lot of opportunity to export the product because we are limiting the countries that players can import from – in other words, they’re limiting the network of businesspeople.

"When it’s a global market, the network is supposed to be bigger and wider, but by limiting the quota and making it difficult for business to import the product."

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