Agriculture Minister Amran Explains Government's Reasons for Regulating Food Prices

Jakarta, CNBC Indonesia - Agriculture Minister/Head of the National Food Agency (Bapanas) Amran Sulaiman has explained the government’s reasons for setting maximum retail prices (HET) and reference selling prices (HAP) on several strategic food commodities, including sugar and rice. According to him, this policy aims to maintain a balance between the interests of farmers, traders, and consumers.

Responding to sugarcane farmers’ proposals to avoid limiting sugar prices in order to increase planting motivation, Amran stressed that the government must act as a balancer.

“So, here’s why there are reference prices like for rice? We want sugar and rice farmers, all strategic commodities, to profit. But consumers should smile. Traders should also be happy. Not profiting too much,” Amran told reporters at his office in Jakarta on Wednesday (15/4/2026).

He emphasised that price policies cannot favour just one side. All elements in the food chain must be protected simultaneously.

“So we must protect all three. So consumers, traders, and producers. All three we must protect. The government must be in the middle,” he explained.

According to Amran, without price regulation, market conditions could become chaotic and risk harming the public as consumers.

“If it’s left unchecked like that, it will be a mess later. Consumers will be pitiful, consumers will be hit again,” he asserted.

He cited the current rice situation, which he assessed as relatively stable and no longer the main contributor to inflation.

“We want… like rice now. It’s safe, right? Rice is no longer the main inflation contributor. Farmers are happy now, consumers are happy. There are one or two who protest, maybe (they) don’t understand how difficult farming is,” said Amran.

Productivity Is Key, Not Price

Responding to complaints from sugarcane farmers who are said to be lethargic due to constrained prices, Amran assessed that the main solution is not price liberalisation, but increasing productivity.

“(By) increasing productivity. That’s why we help. That’s the President’s order (Prabowo Subianto). Help with ratoon dismantling subsidies,” he said.

He claimed to have long experience in the sugarcane sector and stated that increasing harvest yields is the key to farmers’ profits.

“I’ve been in sugarcane for 15 years. The way to profit is to increase productivity, so that 60 tonnes can rise to 80 tonnes up to 100 tonnes per hectare of sugarcane. The yield usually increases too. Fertilisation must be right,” he explained.

Amran also explained the importance of balancing nutrient elements in improving the quality and yield of sugarcane.

“What increases the yield is potassium, KCL. This is for sweetness. For the body, the stem, that’s phosphate. For good photosynthesis, that’s nitrogen. So these three are the main elements that must enter, and must be balanced,” he clarified.

He warned that unbalanced fertiliser could damage the plants. “Because if KCL (potassium) is lacking, phosphate is high, the sugarcane plants can collapse,” Amran continued.

Farmers Demand No Price Limits

Previously, the General Chairman of the Indonesian Smallholder Sugarcane Farmers Association (APTRI) Soemitro Samadikoen assessed that farmers’ interest in planting sugarcane remains low because sugar prices are deemed unattractive.

“Planting or growing sugarcane is still not attractive. Because sugar prices are limited,” Soemitro told CNBC Indonesia some time ago.

He stated that sugar prices ideally should be around 1.5 times the rice price to provide sufficient incentives for farmers.

“Sugar now, the cost of production is already over Rp15,000. So the price should at least cover almost Rp16,875,” he explained.

According to him, with thin margins, farmers prefer to switch to other commodities like paddy, which is deemed more profitable.

“Compared to planting paddy, planting paddy is still more profitable. So don’t limit sugar prices,” he said.

He urged the government to remove the upper limit on sugar prices and leave the pricing mechanism to the market.

“Let the market determine the price. Don’t let us be pegged like this. Our production costs are already that much, but the selling price above it is limited,” Soemitro asserted.