Bulog to raise rice reserves to 2 million tons

Bulog to raise rice reserves to 2 million tons

JAKARTA (JP): President Soeharto instructed the National
Logistics Agency (Bulog) yesterday to increase its buffer stocks
of rice to about two million tons by the end of the 1995-1996
fiscal year.

"The President has instructed all relevant agencies to make a
coordinated effort to enable the targeted level of two million
tons in rice buffer stocks to be met by 1995-1996," Bulog
chairman Beddu Amang said after a meeting with Soeharto at the
Bina Graha presidential office.

Beddu was accompanied by Minister/State Secretary Moerdiono in
yesterday's meeting.

"Our buffer stocks of rice at the moment are about one million
tons," Beddu said.

He said in March that the rice buffer stocks stood at about
800,000 tons.

Beddu said yesterday that Bulog would not import rice if it
managed to achieve the target through domestic procurement. He
said that farmers and traders were continuing to hoard rice.

"Such actions, however, will not last long," he said.

A severe drought last year slashed Indonesia's rice production
by four percent from its 1993 level, to 46.40 million tons of
unhusked rice.

The drought also brought the country's rice supply to its
lowest level in 15 years, forcing Bulog to import for the first
time in many years.

The government predicts that this year's rice output will be
1.5 percent higher than last year's level.

Indonesia, formerly the biggest rice importer in the world,
became self sufficient in rice in 1984. Rice is the main staple
of Indonesia's 193 million people.

Commodities

Beddu made no mention, at yesterday's press conference, of the
retail prices of several Bulog-controlled commodities.

There were several press reports yesterday that the prices of
wheat flour, cooking oil and sugar were continuing to rise,
despite earlier assurances by Bulog and market intervention by
the agency.

The importation and distribution of wheat flour, cooking oil,
sugar and rice are controlled exclusively by Bulog.

The Kompas daily reported yesterday that the price of wheat
flour at various market places here had crept up to about Rp 900
(about 40 U.S. cents) per kilogram. Bulog had previously set a
price of Rp 800, or Rp 616 at the factory gates.

The daily reported that retail prices of white sugar had
reached about Rp 1500 per kilogram, as compared with the Bulog
price range of Rp 1,300 to Rp 1,400.

The report said that retail prices of cooking oil had risen to
Rp 1,470 per kilogram, as compared with the Bulog price of Rp
1,420.

Bulog's grip on various non-rice commodities has been
criticized by various observers, including the World Bank, as
inefficient and counter-productive.

Beddu said last week that Bulog would downsize its operations
in the near future as part of the country's deregulation program.
(hdj)