Bulog told to buy rice to boost local prices

Adianto P. Simamora, The Jakarta Post, Jakarta

The Ministry of Agriculture urged the State Logistics Agency (Bulog) to procure at least 600,000 tons of unhusked rice from farmers this month to help prop up the current sluggish price of the commodity.

"Bulog must procure at least 600,000 tons of unhusked rice in May to help prop up the price," ministry community empowerment for food security general director Ahmad Suryana said on Friday.

Speaking at a conference, Ahmad said Bulog must purchase the farmers' rice at a government-set floor price of Rp 1,230 per kilogram.

Bulog is aiming to purchase up to 3 million tons of unhusked rice (equal to about 2.2 million tons of rice) this year as part of its reserves strategy. The agency has so far bought 1.4 million tons of unhusked rice.

Rice has once again become an issue in the press after the price of unhusked rice at the farm level plunged to Rp 800 per kg as the current harvest season starts.

Some experts have earlier said that farmers get a low price for the unhusked rice partly because of the massive inflow of cheaper imports and the lower quality of the product due to a delay in the planting season.

But Ahmad said that another factor was manipulation by Bulog contractors assigned to purchase the farmers' unhusked rice.

He accused the contractors of taking advantage of farmers weak cash flow by forcing them to sell the unhusked rice at a very cheap price to gain greater profits.

He urged Bulog to monitor the action of its contractors.