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Indonesia hikes rice import quota by 1.6m tonnes to bolster reserves

Jakarta Post - February 28, 2024

Ruth Dea Juwita, Jakarta – The government had increased this year's rice import quota by 1.6 million tonnes to bolster the nation's reserves, the National Food Agency (Bapanas) announced on Monday.

According to Bapanas head Arief Prasetyo Adi, although President Joko "Jokowi" Widodo has instructed the State Logistics Agency (Bulog) to maintain minimum rice reserves of 1.2 million tonnes, ideally the President would like to see minimum reserves of 3 million tonnes while waiting for the primary harvest season to arrive.

"The additional 1.6 million tonnes is a precaution," Arief said on Monday, as quoted by state-owned news agency Antara.

As much as 500,000 tonnes out of the government's initial rice quota of 2 million tonnes for this year had been imported so far, Arief continued. "The [remaining] 2 million tonnes will arrive soon," he added.

While acknowledging the current imbalance in the price of rice for consumers and producers, Arief underlined that the government was prepared to respond to price fluctuations.

The price of rice has recently exceeded Rp 16,000 (US$1.02) per kilogram, far above the government's retail price ceiling (HET) of Rp 10,900 per kg for medium-grade rice at modern retail outlets on Java and other regions.

The increase has been attributed to the high farm gate price of unhusked rice, which ranges between Rp 8,000 and Rp 8,600 in some areas.

"Prices should stabilize once the main harvest brings in 3.5 million tonnes of rice, but it'll take about three weeks for that rice to reach consumers," Arief said.

The government has tasked Bulog with selling rice to the public below the price ceiling through the food supply and price stabilization (SPHP) program, which has distributed some 250,000 tonnes of rice this year to date.

Presidential Regulation (Perpres) No. 125/2022 puts Bapanas at the helm of the SPHP program, with Bulog in charge of managing and distributing food stocks.

Aside from its task of importing rice, Bulog is also involved in stabilizing rice prices through the cheap food movement (GPM), an initiative that sells rice in 5-kilogram packages directly to consumers in residential areas at prices below the HET.

Meanwhile, rice millers in various regions have been asked to distribute rice in 5-kilogram sacks rather than in bulk to ensure wider availability across retailers and traditional markets.

"Bulog sells rice directly to residential areas and crowded places at a price below the highest retail price," Bulog supply chain and public services director Mokhamad Suyamto said on Monday.

Suyamto emphasized that Bulog deemed its current rice reserves of 1.4 million tonnes, along with the remaining import quota of 1.5 million tonnes, were sufficient to meet demand during the peak Ramadan-Idul Fitri holiday season from March to April.

He added that Bulog would continue to distribute food assistance to 22 million households through June.

Source: https://asianews.network/indonesia-hikes-rice-import-quota-by-1-6m-tonnes-to-bolster-reserves