Govt to cut back fertilizer subsidy next fiscal year
Govt to cut back fertilizer subsidy next fiscal year
JAKARTA (JP): The government has decided to cut back fertilizer subsidies by Rp 6 billion (US$ 2.62 million) to Rp 137 billion in the 1996/97 fiscal year, despite the commodity's soaring price on the domestic market over the last couple of months.
Minister of Agriculture Sjarifudin Baharsjah announced the government's decision at a meeting with members of the House of Representatives' Commission IV, which oversees agriculture and forestry affairs, yesterday.
He emphasized that the cutback on subsidies does not mean that the government will raise fertilizer prices.
"So far, the government has not stipulated any new price for fertilizers," Sjarifudin said, adding that the government would take steps to lower prices in the market places.
To prevent price hikes, he said, his office would act in conjunction with the Ministry of Industry and Trade, the Ministry of Cooperatives and Small Enterprises and state-owned fertilizer producer PT Pupuk Sriwijaya to optimize the distribution of fertilizers to village cooperatives and other users.
Sjarifudin said the government would also require Pupuk Sriwijaya to keep one month's supply of fertilizer stockpiled at its storehouses.
Pupuk Sriwijaya is currently required by the Ministry of Industry and Trade to have extra stocks for two weeks only.
Sjarifudin said large amounts of urea fertilizer would also be used to restore plantation areas hit severely by the 1994 drought and to carry out the government's special farm-intensification programs.
For the 1996/1997 fiscal year, the government estimates that 5.9 million tons of fertilizer will be needed. This amount will consist of 3.5 million tons of urea, 1.2 tons of superphosphate- 36 (SP-36), 607,910 tons of ZA and 581,010 tons of KCL.
The media have been reporting nationwide fertilizer shortages for the last couple of months.
Several analysts said that the lack of granular urea might be caused by distribution problems, while others said it was due to efforts to intensify the use of new, tablet-type urea, which farmers actually find harder to apply.
Meat
Meanwhile, in response to recent reports on the importation of meat, Sjarifudin said yesterday the imports could have been made to anticipate the upcoming Idul Fitri holiday next month.
Director General of Animal Husbandry Soehadji told reporters that meat imports were permitted as long as they were not used to supply public markets.
"Supplies from traditional farms managed by farmers will continue to be the backbone of our public meat market, supplying up to 78 percent of demand," he said.
Some 16 percent would come from the larger-scale fattening farms, where cattle are raised, and the remaining six percent from imports.
He said Indonesia's meat consumption for the upcoming fiscal year is expected to reach 451,000 tons, but domestic farms' current capacity is only 352,000 tons. (pwn)