Govt calculating annual rice price increase<\/p>\n
JAKARTA (JP): The government is calculating this year's annual
\nincrease in the producer (floor) price of rice and will announce
\nit later this month, Minister of Agriculture Sjarifudin Baharsjah
\nsaid yesterday.<\/p>\n
\"The formula for determining the price increase is similar to
\nthat used last year,\" Sjarifudin told reporters.<\/p>\n
Last year, the rice floor price was raised 12.5 percent which,
\nwhen adjusted for 8.65 percent inflation in 1995, amounted to a
\nreal rise of 3.85 percent.<\/p>\n
But the increase did not stop the erosion of rice farmers'
\nterms of trade because the price of granular urea rose 27 percent
\nand that of urea tablets rose 11 percent in February last year.<\/p>\n
\"The main objective of the rice price increase remains the
\nsame: to further improve the real incomes of rice growers,\"
\nSjarifudin added.<\/p>\n
He said the government had not yet decided whether to effect
\nan annual increase in the price of fertilizer.<\/p>\n
\"We are still mulling over the question as to whether the
\ngovernment will still subsidize the price of fertilizer for rice
\ncrops,\" he said.<\/p>\n
The floor price of rice -- the price that village cooperatives
\npay farmers -- now stands at Rp 450 (US$0.19) a kilogram for
\nunhusked rice.<\/p>\n
Besides increases in the price of fertilizer, inflation is a
\nmajor variable in the formula to determine rice price rises.<\/p>\n
The inflation rate fell to 6.5 percent last year from 8.64
\npercent in 1995.<\/p>\n
\"We certainly take into account likely inflationary pressures
\nwhen increasing the rice price,\" Sjarifudin said.<\/p>\n
The agriculture ministry estimated that 51 million tons of
\nunhusked rice or the equivalent of around 33.15 million tons of
\nmilled rice were produced domestically last year. This
\nrepresented a mere 2.6 percent increase on the 49.74 million tons
\nharvested in 1995.<\/p>\n
The ministry estimates per capita rice consumption this year
\nat 130 kg, or 25.9 million tons for the population.<\/p>\n
The country, which achieved rice self-sufficiency in 1984, has
\nbeen depending partly on imports since 1994 because of a slowdown
\nin the growth of rice production. (vin)<\/p>",
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