New logistics chief<\/p>\n
State Minister of Food Ibrahim Hasan's relinquishing of his
\nconcurrent post as chief of the National Logistics Agency (Bulog)
\nyesterday seemed rather unusual. After all, we have long been
\naccustomed to the normal bureaucratic scheme of things whereby
\nthe official postings for key officials are based more on a fixed
\ntenure -- normally five years, but extendable -- rather than on
\nperformance.<\/p>\n
That is the reason, we think, why State Secretary\/Minister
\nMoerdiono felt it necessary to explain yesterday that President
\nSoeharto had planned for a long time to separate the logistics
\nagency's function from the office of the food minister. Hasan,
\nwho was once deputy chief of Bulog, was appointed as head of the
\nlogistics agency in March, 1993, concurrently with his assignment
\nas the minister of food in the Sixth Development Cabinet.<\/p>\n
Nonetheless, because Moerdiono, when he installed Beddu Amang
\nas the new chief of Bulog, talked at length about the unusually
\nhigh inflation in recent months (with the steep rises in food
\nprices viewed as mainly responsible for the hike in the consumer
\nprice index) Bulog's performance got the spotlight. The bottom
\nline conclusion is that Bulog has failed to perform its main task
\nof stabilizing the prices of basic commodities, most notably rice
\n-- the nation's staple food.<\/p>\n
Hasan himself has admitted that Bulog's domestic rice
\nprocurement last year totaled only 938,000 tons, the lowest level
\nin the past 15 years. Because the rice price has been on the rise
\nsteadily over the last 10 months, the food agency, its buffer
\nstocks already way below the normal level of two million tons,
\nhas been forced to step up its market operations in a bid to curb
\nthe trend. Between April 1994 and January 1995, for example,
\nBulog was forced to draw down almost 800,000 tons on its already
\nall-time low stock level.<\/p>\n
Informed sources said Bulog's stocks had at one time fallen to
\nas low as 200,000 tons, a level which is not sufficient even to
\ncover two months of food allowances for the government personnel
\nand employees of state-owned agro-based companies. The food-
\nsupply situation has been saved from a crisis only by 900,000
\ntons of new stocks derived from imports and the early repayment
\nof rice loans by several foreign governments.<\/p>\n
That situation is worrisome indeed because the supply of rice,
\nbesides weighing heavily in the components of the consumer price
\nindex that measures the inflation rate, may also affect the
\npolitical stability of the nation.<\/p>\n
The question, though, is whether Bulog is the only agency that
\nshould be blamed for the inadequate rice supply. Bulog is in
\ncharge of managing stocks only. It procures surplus production
\nfrom the farmers to maintain the government-fixed floor price and
\nreleases stocks to the market to stabilize prices at the desired
\nlevel. But the stocks should come from the rice fields whose
\ndevelopment and management are the responsibility of the Ministry
\nof Agriculture.<\/p>\n
The Central Bureau of Statistics has announced that national
\nrice production declined by about four percent last year. In
\nfact, official statistics show that over the last five years only
\n1992 posted a bumper harvest with an almost eight percent
\nincrease in production. The output was also down by 0.15 percent
\nin 1993 and by two percent in 1991, and up only by one percent in
\n1990. The sharp drop last year should naturally be blamed on the
\nprolonged drought. But further analysis also indicates that the
\ngrowth in the yield rate of our rice fields over the last five
\nyears has been rather negligible. Nationwide, the average yield
\nrose from 4.25 tons per hectare in 1989 to 4.38 tons\/ha in 1993.
\nEven in Java, where the bulk of irrigated rice fields is located,
\nthe average rice yield rose slightly from 5.02 tons\/ha in 1990 to
\n5.13 tons\/ha in 1993.<\/p>\n
The trend, we think, is worrisome as it indicates virtual
\nstagnation in the productivity of our rice fields. When this
\ntrend is combined with the steady loss of irrigated land in Java
\nto industrial and housing developments, the deceleration in the
\ngrowth of the rice supply becomes even more worrisome. Under such
\na situation, Bulog, however professional its management may be,
\nand however smart its market analysis may be, will not be able to
\nperform its task properly.<\/p>\n
The rice production trend makes it appear as if the Ministry
\nof Agriculture has become rather complacent and is lacking in
\nboth the innovation to further increase the yield of existing
\nrice fields and the drive to open up new fields outside Java. If
\nthe Ministry of Agriculture is not jolted by the current rice
\nsupply situation to a new all-out effort to steadily increase
\nproduction, we will become increasingly dependent on imports.
\nThat is a painful setback from our internationally-commendable
\nrecord of rice self-sufficiency, which was achieved in 1984.<\/p>",
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