News reports suggest that Wilmar is planning to enter Indonesia’s consumer flour market as early as 2012.
· FFM is reportedly planning to spend US$46mn to double its flour production capacity in Indonesia and Malaysia over the next 2Y. Plans appear to be for Wilmar to use its distribution network to sell the flour.
· This may be a threat to Indofod (INDF IJ) as Indonesia's flour market is dominated by Bogasari Flour Mills (Indofood) who has about 55% market share in the flour segment.
· We also hear that Wilmar is planning to expand into branded cooking oil segment in Indonesia. This would be a threat to Indofood cooking oil Bimoli which is currently the market leader in branded cooking oil category.