Jakarta – Indonesian Agriculture Minister Amran Sulaiman has expressed shock – shock – that the price of beef has surged following a massive cut in the import quota by the government.
Amran, speaking to reporters at his office in Jakarta on Monday, said he had confirmed that there was "sufficient" cattle at feed lots nationwide. "So why is [the price of beef] rising? This needs to be investigated," he said.
The minister claimed that local feed lots had a combined 160,000 head of cattle, enough to meet what he defined as domestic consumption of 40,000 head per month. Indonesia had to import more than twice that amount per month just to meet local demand in the second quarter of the year.
Amran also refused to address the fact that the Trade Ministry in July slashed the import quota of Australian cattle – Indonesia's biggest supplier – to just 50,000 head in the third quarter, down from 279,000 head in the previous three months.
"Imports are only needed to meet domestic demand," he said. "I just manage the stock. If the stock is safe, my job is done."
The government on Monday agreed to allow Bulog to import an additional 50,000 head of cattle this quarter, in a tacit acknowledgement that its bid for food self-sufficiency has backfired, driving the price of beef skyward and leaving traders and consumers feeling the pinch.
On Sunday, merchants at the Kramat Jati market in East Jakarta said they would not sell beef for four days to express their frustration over the high prices.
Endang, a beef seller, said the price of beef at the traditional market had stayed at Rp 120,000 ($8.85) per kilogram since before the end-of-Ramadan festivities in mid-July, when inflation typically peaks.
"Until now prices aren't coming down," she said, adding that realistically she would be able to charge even more, up to Rp 150,000 per kilogram. "It's very expensive, we feel sorry for our customers."
Endang also said the government's decision to slash the import quota for Australian beef was directly to blame for the higher prices, as local supply remained insufficient. "Traders just want normal prices," she said. "The government has to see what's going on, check out the prices."
Trade Minister Rahmat Gobel, whose office is responsible for managing the beef import quota, said on Monday that the vendors' strike was "not right," and blamed importers and wholesalers for deliberately throttling back supplies to the market to inflate prices.
The Trade Ministry state-owned Bulog, which manages food stockpiles, responded to the issue on Monday by selling government-subsidized beef at various markets, including Kramat Jati, at Rp 90,000 per kilogram, in what it called a "market operation."
Sofyan Djalil, the chief economics minister, said this move was only a stopgap measure, and that longer terms solutions were needed, including the possibility to increasing the import quota.
"We've held a meeting" – with the ministers of trade and agriculture and the Bulog chief – "to decide on our options, including allowing more imports by Bulog," Sofyan told reporters at the Indonesia Stock Exchange (IDX) on Monday.
Jakarta Governor Basuki Tjahaja Purnama, who ordered city-owned market operator PD Pasar Jaya to take part in the "market operation" with Bulog and the Trade Ministry, said the notion of Indonesia being self-sufficient in beef production was far too premature.
"It's basic supply and demand: if demand is higher than supply, then the price will obviously go up. We're just not ready to be self-sufficient in beef supply," he told reporters at City Hall.