Experts urge government to create pro-farmer policy
Experts urge government to create pro-farmer policy
Adianto P. Simamora, The Jakarta Post, Jakarta
The government's program of expanding the country's acreage of
paddy fields to raise rice output and reduce reliance on imports
will not be effective unless it is coupled with a pro-farmer
policy aimed at raising farmers' incomes and thus encouraging
them to plant rice, experts said over the weekend.
"Opening new paddy fields is not the only solution for solving
our rice problem. The most important thing for the government to
do now is reform the agriculture policy in order to give more
benefits to farmers," noted agricultural expert H.S. Dillon, who
is also head of the Center for Agricultural Policy Studies, told
The Jakarta Post.
Earlier, the Ministry of Agriculture said it had launched a
program to expand the country's paddy fields by 100,000 hectares
per year over the next eight years in order to prevent the
possibility of a rice crisis by the end of the decade.
Achmad Suryana, head of the ministry's Community Development
and Food Security Agency, warned that without the program, the
country's rice shortage could, by the end of this decade, soar to
a level that even imports could not cover.
The program had been presented during a Cabinet meeting but
thus far no decision on it had been made.
Dillon said the program was actually not new.
"The ministry launched a similar program some years ago, which
was funded by the state budget. Unfortunately, the program failed
and until today, there has been no accounts presented over the
use of the funds," Dillion said.
Dillon noted that unless farmers see the prospect of better
earnings, they would not be interested in planting rice in the
new fields.
In order to increase farmers' earnings, he said, the
government needed to ensure price stability and help increase
land productivity.
"The present price of Rp 1.500 (about 16 U.S. cents) per
kilogram set by the government for unhusked rice is not
acceptable. It should be reviewed to take account of rising
production costs, including fertilizer and pesticide costs," he
said.
The government price is the floor price for procurements by
the State Logistics Agency (Bulog).
An official of the Ministry of Agriculture, who wished to
remain anonymous, explained that rice production costs stood at
Rp 800 per kilogram.
Based on the government's price of Rp 1,500 per kilogram for
unhusked rice, a small farming family in Java, which typically
has 0.3 hectares of paddy fields, can still earn Rp 700 per
kilogram. With an annual production of three tons of unhusked
rice, the farmer gains a total profit of Rp 1.8 million per year,
the official said
Ibrahim Warsinta, a farmer in Karanganyar village, Cirebon
district, West Java, dismissed this calculation as failing to
reflect reality. He told the Post that farmers' incomes were much
lower due to price instability.
He said farmers were happy about the government's price
provided that it was stable. In fact, during harvest season, they
could only sell their produce at a price of Rp 800 per kilogram
to traders, because Bulog refused, or had no money, to buy it
from the farmers.
Some analysts blame corrupt Bulog officials, who collude with
traders, for deliberately suspending purchases during the harvest
season so as to depress prices.
Indonesia achieved self-sufficiency in rice production in
1984, for which then president Soeharto received an award from
the United Nation's Food and Agricultural Organization.
However, the country's rice production has since continuously
declined, forcing Indonesia to import millions of tons of rice
every year.
Rizal Ramli, former coordinating minister of the economy,
welcomed the paddy field expansion program as it would raise the
country's rice output and lower its dependence on imports.
He noted, however, that the government should prioritize
raising the productivity of existing paddy fields.
"Our paddy field productivity is still very low at about 4.2
tons per hectare compared with other countries where productivity
reaches up to 7 tons per hectare," Rizal told the Post.
He said that in order to boost productivity, the government
should help local farmers by providing good fertilizer and seeds.
"If the land productivity increases, farmers will receive
higher incomes and will be encouraged to continue planting rice,"
Rizal, who is also a former Bulog chairman, said.
Rizal recommended that the government approve the paddy field
expansion program and finance it.
The Ministry of Agriculture refused to reveal the total
funding needed for the program but data from the Indonesian
Farmers' Association (HKTI) says that the cost of opening up one
hectare of paddy field is between Rp 4 million and Rp 12 million.
This means the ministry would need between Rp 400 billion and Rp
1.2 trillion to open 100,000 hectares of land per year.
Sri Adiningsih, an economist from Gadjah Mada University, laid
her weight behind the paddy field expansion program, but she
urged the government to involve the private sector in carrying it
out.
"The program is okay but the government would be wise to
collaborate with the private sector in realizing the program,"
Sri told the Post.
Indonesian paddy field productivity
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Year Production Harvest Area Productivity % Growth
(million tons) (million ha) (ton/ha)
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1990 45.2 10.5 4.3
1995 49.7 11.5 4.3
1996 51.1 11.5 4.2 1.5
1997 49.3 11.1 4.4 0.3
1998 49.2 11.7 4.2 5.3
1999 50.0 11.9 4.2 1.3
2000 51.9 11.7 4.4 3.5
2001* 50.0 11.4 4.3 0.1
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* Projected
Source : Central Statistics Bureau (BPS)