JAKARTA, April 5, 2011 - Indonesian cocoa bean exports from the main growing island of Sulawesi fell 40 percent in March compared to the same month last year as rains hampered the harvest and exporters held beans to avoid a higher export tax, industry data showed on Tuesday.
Exporters shipped 11,132.01 tonnes of cocoa beans in March, down from 18,465.88 tonnes in the same month a year ago, data from the Indonesian Cocoa Association (INCA) showed.
"The main factor is prolonged rains. Additionally, traders are keeping their stocks, waiting for the export tax to fall," said Zulhefi Sikumbang, chairman of INCA.
Indonesia's weather bureau forecast the dry season will start in most areas around May-June, whereas normally the dry season runs from April to Sept/Oct.
Indonesia, the world's third largest cocoa producer after Ivory Coast and Ghana, expects cocoa production will fall slightly this year as the wet weather has worsened pest attacks and disease.
Indonesia imposed an export tax for cocoa beans in March at 10 percent, unchanged from February, and has lifted it to 15 percent for April. There was no export tax in March last year.
"The export tax is high. I expect no trader will sell their stocks unless they have contracts for April shipments," said David Lim, a Makassar-based trader.
Traders were likely to slow shipments in April to avoid the higher tax, agreed Sikumbang. Exports may pick up in May as the main harvest will be underway and the export tax is expected to be lower in line with easing New York cocoa prices, he said.
Cocoa futures prices <, which hit a 32-year peak last month, pared earlier gains on Monday after market expectations of a resolution to Ivory Coast's conflict were not met.******
