Farmers have yet to enjoy sugar price increase<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
Following the skyrocketing price of sugar in the market, a
\nnumber of economists have called on the government to revoke the
\ncurrent sugar trade regime and free the sugar market, while sugar
\nfarmers warn that they have not yet benefited from the currently
\nhigh price.<\/p>\n
University of Indonesia economist Chatib Basri wrote, in a
\nfront page article in Kompas newspaper on Monday, that the
\ncurrent trade regime benefited only a few importers and
\ndistributors but penalized consumers as a whole.<\/p>\n
\"This shows a corrupt trade regime, ending with a price
\nincrease that will only hit poor people,\" he said.<\/p>\n
According to Chatib, the best, short-term way to handle the
\nsugar problem would be through a tariff system.<\/p>\n
Therefore, when prices went up, the government could lower
\ntariffs, but when supplies were in abundance the government could
\nincrease tariffs.<\/p>\n
The long-term solution would be to relocate inefficient sugar
\nplants in Java to islands outside Java.<\/p>\n
Researcher at the University of Indonesia Ine Minara Ruki
\nagreed, saying on Monday that the trade regime would be
\ntemporarily effective in stabilizing sugar prices.<\/p>\n
\"But this is only a short-term solution; the root of the
\nproblem now is the inefficient local sugar industry,\" Ine said.<\/p>\n
She said that the government had to make concrete programs to
\nhelp the ailing sugar industry in a bid to boost output.<\/p>\n
Sugar prices have increased from Rp 4,000 (45 U.S. cents) per
\nkilogram earlier this month to around Rp 6,000 now.<\/p>\n
Many blame the sudden increase on the failure of the appointed
\nimporters, namely state plantation firms and the State Logistics
\nAgency (Bulog), as well as distributors that sought large profits
\nfrom the business.<\/p>\n
This incident has encouraged many to ask the government to
\nrevoke the policy.<\/p>\n
Meanwhile, the Association of Sugarcane Farmers (APTRI) said
\nthat it supported the current trade rules on sugar, which limit
\nthe importation of sugar by state-owned plantation companies and
\nBulog.<\/p>\n
APTRI chairman Abdul Wachid said that farmers had not yet
\nenjoyed the currently high market price of sugar, as they had not
\nyet harvested their sugar cane.<\/p>\n
The harvest would normally start in May, as the country's
\nsugarcane processing plants start grinding from May through July.<\/p>\n
Wachid warned that if the government revoked the current trade
\nrules on sugar, thousands of sugarcane farmers would stage a
\nmassive rally.<\/p>\n
\"We shall continue struggling so the policy remains intact
\nuntil the sugarcane grinding process commences next month,\" he
\nsaid.<\/p>\n
It was also sugarcane farmers that forced Minister of Industry
\nand Trade Rini Soewandi to introduce sugar trade regulations via
\na ministerial decree last year.<\/p>\n
The decree stipulated only companies that bought some 75
\npercent of their raw material from sugarcane farmers were allowed
\nto import sugar.<\/p>\n
It also said that the imports could only be carried out if the
\nprice had increase to Rp 3,100 per kilogram at the sugarcane
\nfarmers' level.<\/p>\n
Speaking at a media conference on Monday, chief editor of the
\njournal Sugar Observer Agus Pakpahan said the decree was fine,
\nbut its implementation was wrong, resulting in a sharp rise in
\nsugar prices.<\/p>\n
\"The spirit of the decree is lofty (to help protect
\nfarmers)... but the implementation is still very poor.\"<\/p>\n
Therefore, Agus, former director general for plantations at
\nthe Ministry of Agriculture, urged the government to maintain the
\npolicy, saying it was effective in protecting the interests of
\nsugarcane farmers.<\/p>",
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"sponsor": "Okusi Associates",
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