Author: Gordon Platt
Company To Watch: Indofood Sukses Makmur/indonesia

Low commodity prices are hurting Indonesia’s export earnings, but they could benefit Indofood Sukses Makmur, one of the world’s largest makers of instant noodles, commonly known as ramen noodles.

With about 238 million people, Indonesia is a big consumer of instant noodles. Indofood makes 13 billion packs of noodles a year. “Lower commodity prices should benefit our consumer branded products group,” says Indofood chief executive Anthoni Salim. Indofood is listed on the Jakarta Stock Exchange and is controlled by the Salim family through First Pacific.

Besides instant noodles, Indofood’s consumer products include seasonings and snacks. In December 2008 Indofood acquired Singapore-based Drayton, which produces milk and ice cream. Drayton holds a nearly two-thirds stake in Indolakto, Indonesia’s leading milk processor. Indofood also controls two of the world’s largest flour millers through its Bogasari Flour Mills subsidiary. Indonesia’s gross domestic product expanded 6.1% in 2008, but the country’s growth is expected to slow considerably in 2009, in part due to economic weakness in Japan, its biggest export market.

Gordon Platt