Indonesia is a potential market for Canadian wheat

The introduction of US tariffs on Canadian goods is forcing Canada to look for new markets, and one promising direction is Indonesia. As one of the world’s largest importers of wheat, Indonesia does not produce this crop, but its demand is growing due to urbanization and changing eating habits. The country’s wheat imports are expected to exceed 12 million tonnes in the MY 2024/25, making this market attractive for Canadian exporters.

The concluded Comprehensive Economic Partnership Agreement between Canada and Indonesia (CEPA) improves trade terms by reducing tariffs and simplifying market access. This creates favorable conditions for the Canadian agricultural sector, especially for wheat exporters, who can strengthen their position by taking advantage of the agreement.

Demand for wheat in Indonesia is provided by three key industries: the production of noodles, bread and snacks. In 2023, the country’s instant noodle consumption reached 14.54 billion servings, making this segment the main driver of wheat imports. There is also growing demand for bread, especially among the urban middle class, and the flour snack market is forecast to reach $4.54 billion by 2025.

Canada is the second largest supplier of wheat to Indonesia after Australia, exporting 2.4 million tonnes in 2023. The main competitors are Russia, Bulgaria, Brazil, Ukraine and the United States. However, Canadian wheat has competitive advantages such as higher protein content and consistent quality, making it attractive to flour mills.

The implementation of CEPA could further strengthen Canada’s position in the Indonesian market by reducing costs for local importers. This will enable Canada to compete with European and American suppliers, expanding its presence in the region and contributing to the diversification of export markets.

Tags: wheat, Indonesia, Canada