Lenny Tristia Tambun – A national business organization has called on the government to reconsider its beef "self-sufficiency" program, which its members say has caused a scarcity of the meat.

Sarman Simanjorang, Jakarta branch chairman of the Indonesian Indigenous Entrepreneurs Association (HIPPI), said a government quota on beef imports had driven up prices to Rp 80,000 ($8.70) per kilogram, pushing meatball and sausage producers to the brink of collapse.

The price of beef is expected to reach Rp 120,000 a kilogram during the Idul Fitri, Christmas and New Year's holidays. The government cut its allotment for beef imports by 66 percent for 2012, reducing it from around 50,000 to 60,000 tons per year to 34,000 tons.

"The sharp decline has led to scarcities and soaring prices," Sarman said on Friday. "The Agriculture Ministry was convinced the shortage could be covered with local beef stock, according to a census of cattle, but the fact is there is very little stock."

Traders in East Java, traditionally a cattle supplier, are already complaining about a beef scarcity, he said. Jakarta and its surrounding areas import 80 to 90 percent of its beef.

In 2011 the government set an import quota of 100,000 tons, down from 120,000 in 2010. But Jakarta alone requires 50,000 to 60,000 tons of beef per year, Sarman said.

This year's quota is divided into two semesters, with 20,400 tons for the first semester, which runs until July, and 13,600 tons for the second. But the first semester quota was only sufficient to meet demand until April, Sarman said.

The quota for the second half is expected to meet only two months' worth of demand, which will be a disaster for religious events, he said.

He said the government needed to be realistic. "The Agriculture Ministry has failed with its beef self-sufficient program twice already: once in 2005 and the again in 2010," he said.

Sarman said he hoped the government would put in place a special quota for Jakarta by allowing the capital to get 50,000 to 60,000 tons of imported beef. That, he said, would save small industries that depend on the raw meat.

Tatat, who runs Husada Sari Rasa, a meatball business in Pulo Gadung, East Jakarta, said profits had plunged 70 percent.

"I'm struggling to keep my business afloat," said Tatat, who sells meatballs in traditional markets and supermarkets. "The price of beef has surged by 35 percent but we can't increase our meatball price by 35 percent. In the end, we had to lower quality."

He started the business in 2001, hiring 150 workers to turn 1.5 tons of meat into 400,000 meatballs per day. With meatball prices ranging from Rp 100 to Rp 400 each, he could make about Rp 160 million per day.

"Our business used to go well and the profits could be used to pay workers' salaries," he said. But since the import cap took effect, Tatat hasn't been able to get the supply he needs. Breeders he has approached have told him that they don't need the money yet or otherwise aren't selling their cattle.

With profits being squeezed, Tata was forced into a drastic downsizing. He said he had to let 100 workers go, leaving only 50 people on the payroll. Since the beginning of the year, Husada Sari Rasa has only been able to process 400 to 500 kilograms of beef into 100 to 200 meatballs every day, he said.

Tatat said the government needed to remove its cap on beef imports or ensure there was a sufficient local beef supply. He threatened to organize protests if the government failed to fix the mess it had made.

Hermanto, manager of Husada Sari Rasa, said the business was collapsing. "The government doesn't understand that we've never experienced anything this bad," he said. "Last year was not as difficult as this year. Do we have to stage a rally to get the government to allow beef imports?"