Urip Hudiono, Jakarta – The government will import another 500,000 tons of rice to help keep prices from rising further after monsoonal flooding across the country disrupted the production and distribution of the nation's staple foodstuff.
The rice will be imported in March and April, Vice President Jusuf Kalla told reporters Tuesday after a meeting with economics ministers at the headquarters of the State Logistics Agency (Bulog). The Vice President said bids from suppliers had already been solicited.
"We need to secure the supply of rice to the market and distribute as much rice to the poor as is needed. That's why importing rice is reasonable in these circumstances," he said.
The government imported 500,000 tons of rice in January, saying that it would import more over the course of the year as required.
A total of 138,000 tons of imported rice will be delivered this month, Coordinating Minister for the Economy Boediono had earlier said, with another 350,000 tons arriving in March so as to buffer the country's rice stocks until such time as local production kicks in during the harvest.
The original decision to import rice came after prices rose to Rp 5,000 (55 US cents) a kilogram in December and January, threatening a possible uptick in inflation.
The government then also instructed Bulog to supply the market with rice at a subsidized price of Rp 3,700 a kilogram. Recent torrential rains have, however, disrupted rice production and distribution, prompting further increases in rice prices to more than Rp 5,000 a kilogram in some regions.
Crops on more than a quarter of the 135,115 hectares of farmland that were flooded have been completely destroyed, while many distribution routes – including routes through the national capital, Jakarta, which was among the areas worst affected by the floods – were badly disrupted.
Agriculture Minister Anton Apriyantono had earlier said there could still be a rice shortfall of as much as 370,000 tons this month in the run-up to the harvest.
The government expects the harvest to be delayed until April because of the rains, and sees drought conditions later this year as being likely to affect production again as a result of the El Nino weather cycle.
Kalla said that Bulog would continue to supply the market with subsidized rice from its stocks, which would be augmented by the imported rice, so as to stabilize prices at some Rp 4,000 a kilogram.
Importing rice has always been a controversial issue for Indonesia, with the focus of the debate being whether to side with the country's consumers or rice farmers.
A recent World Bank report on poverty in Indonesia noted that rising rice prices had contributed to an increase in the number of people living in poverty.