Amran Admits Premium Rice Scarcity in Market, Explains the Cause
The Minister of Agriculture, Amran Sulaiman, has revealed the suspected cause behind the scarcity of premium rice in the market. According to him, some producers are allegedly shifting sales from premium rice to fortified rice in an attempt to secure higher profit margins.
Amran stated that this suspicion arose after the Ministry of Agriculture discovered that much of the rice marketed as fortified rice failed to meet fortification standards during laboratory testing. He explained that producers are likely pivoting to fortified rice claims because the operational space for premium rice is narrowing. By selling products labelled as fortified, Amran noted, actors can achieve significantly higher profits.
“Previously, it was noted that they shifted there. Our suspicion is that with premium rice, they cannot manipulate prices because we regulate them. So, they are moving because margins are thin, as they always seek high profits. Imagine if they sell it at Rp42,000 per kg—the profit is insane,” Amran told reporters in Jakarta on Friday.
In preliminary inspections, the Ministry of Agriculture found that approximately 80% of the tested fortified rice samples did not meet the required standards. Testing is being conducted across several laboratories and will be expanded to involve 5 to 10 laboratories to ensure the accuracy of the results.
“It turns out some are priced as high as Rp42,000 per kilogram. This is nonsensical; it is a deception. After taking samples from all registered fortified rice, as well as unregistered ones, 80% of the registered ones do not meet the standard. The average price is Rp22,665 per kg, yet some are at Rp42,000 per kg. This makes no sense,” he said.
“Therefore, we are now using many laboratories, as we did before. We may use up to 5 to 10 laboratories. Results from three laboratories have already emerged, showing that 80% is not fortified rice or does not meet the standard. We will certainly follow up on this and take action,” Amran asserted.
Amran emphasised that fortified rice is intended for low-income communities and groups requiring nutritional supplements, such as those suffering from stunting. Consequently, he argued, the price of fortified rice should not differ significantly from medium-grade rice.
“There are those trying to manipulate the market. The Indonesian rice industry is shifting from premium rice to fortified rice. What is fortification? It is rice enriched with specific vitamins, intended for the lower-middle class or those facing stunting or nutritional deficiencies. Logically, the price should be cheap. It should be at least equal to medium rice, or perhaps slightly higher due to the added vitamins,” he explained.
Following these findings, Amran ensured that the government will take firm action against violating producers, including revoking the licences of fortified rice that are proven to be non-compliant.
“We will regularise this. I have requested a detailed check. Once it is confirmed that they have violated regulations, I will revoke the licence. That is the first step. This will ensure that what is circulating meets the standards,” he said.
He revealed that there are currently around 40 fortified rice licences issued by the National Food Agency (Bapanas). However, the revocation of licences will be carried out against products proven to violate regulations during the law enforcement process.
Amran also mentioned that 15 fortified rice brands are currently under investigation. The identities of these brands have not yet been disclosed as the investigation is ongoing before being handed over to law enforcement agencies.
He further noted that all samples were collected from 14 rice production centres across Indonesia, not just on Java Island.
“From all over Indonesia. (The most) from Java and Lampung,” he concluded.