Bulog raises flour prices

JAKARTA (JP): The National Logistics Agency (Bulog) has raised flour prices to Rp 704.44 (US$0.30) a kilo, including value added tax, from Rp 681.91 due to increasing wheat prices on the world market.

Bulog's chairman, Beddu Amang, told journalists yesterday that the world's wheat prices have now increased to the region of $250 to $280 a ton from $180 in 1994.

Although the flour price has been raised, Beddu said, Bulog will not change its wheat prices or wheat processing fees.

Bulog's wheat is processed into flour by privately-owned flour mills, mostly owned by PT Bogasari Flour Mill -- an affiliate of the giant Salim Group.

Beddu said the increase of flour prices, effective this month, is expected not to raise flour prices at the retail level. He argued that retailers should maintain their old prices considering they have collected relatively large profits from the previous flour price.

He noted that flour prices have been relatively stable at market places. They contributed only 0.003 percent to the inflation rates recorded in the 1994/1995 and 1995/1996 fiscal years, ending in March.

This year, Beddu said, Bulog will import some 3.4 million tons of wheat, almost the same as last year's level. Most of the country's imported wheat comes from Australia. (pwn/rid)