Government plans to raise fertilizer handling fees

Government plans to raise fertilizer handling fees

JAKARTA (JP): The government will raise fertilizer handling
fees for village cooperatives and retailers, and increase
fertilizer stocks by 10 percent to 4.4 weeks of consumption, said
Minister of Industry and Trade Tunky Ariwibowo.

"We don't know the exact fee yet, as the minister of finance
has yet to issue a ruling. But the increase should be between 17
and 30 percent," Tunky told the press here yesterday after
launching a supplement on small industries in the economic daily
Bisnis Indonesia.

Currently, the fertilizer handling fee for village cooperative
dealers is Rp 2,131.8 (91 U.S. cents) per ton, for village
cooperative retailers Rp 2,750 per ton and for the distribution
from districts to sub-districts is Rp 9,223.96 per ton.

Tunky said that the government needs to raise the fees because
the current fee doesn't cover handling costs.

"The fees fertilizer distributors and retailers are paid
should cover their operational costs. We hope that with this
increase, the distribution of fertilizer all over the country
will proceed smoothly," he said.

Asked by reporters whether the low fees had caused the
scarcity of fertilizer on the ground, Tunky side-stepped the
issue by saying: "I don't want to confirm this, everyone has
their own costs. Some have low costs, but others may have higher
costs. That is simply business," he said.

Replying to the same question, Minister of Cooperatives and
Small Enterprises Subiakto Tjakrawerdaya, who accompanied Tunky
at the launching ceremony, answered: " That is your own
conclusion. You should remember that the government has not
raised fees for the last 10 years."

Farmers in several provinces have been complaining of a
shortage of fertilizer which had caused the agrochemical's price
to rise above government-set levels.

In several districts farmers have been so frustrated by the
suspicious shortage of fertilizers that they have vandalized
their cooperative buildings.

Tunky said that the stock increase would raise the volume of
fertilizer subsidized by the government during the current fiscal
year, starting this month, from 3.5 million tons to 4.2 million
tons.

The government, said Tunky, has also asked the state-owned
fertilizer company PT Pusri to help cooperatives improve their
stock and distribution management. (13)