Indonesia gears up to boost rice output

Indonesia gears up to boost rice output

PHUKET, Thailand (Reuters): Indonesia, whose projected 6.25
million-metric ton rice purchases this year have stunned the
world, will boost output to reduce dependence on imports, a
senior government official said on Thursday.

But it could take some time before the country with a
population of 202 million could become self-sufficient again,
said P. Suharno, head of Bulog's (National Logistics Agency)
Research and Development Department.

The Indonesian government had previously set 2001 as a target
date for self-sufficiency.

Suharno told Reuters in an interview that the government had
earmarked Rp 4.3 trillion (US$573 million) for credits to be
extended to rice farmers, the biggest credit budget ever.

"The government will provide very soft loans for farmers so
that they can use this money to buy fertilizers and pesticide to
use in their farming and increase production," Suharno said.

"The rupiah has stabilized and that will reduce the cost of
imported chemicals and raw materials. The amount of credit is the
biggest ever. In the past few years, the government provided only
around 200 billion rupiah annually," he said.

New high-yielding strains were being distributed to farmers
and experts as well as thousands of students mobilized to help
farmers increase the yield, the official said.

Suharno said he expected rice output next year to be better
than 46.44 million tons seen this year and the country was very
likely to import less.

Most of the rice in the country comes from the main island of
Java. The rice cultivation area is estimated at around 11.06
million hectares.

"We don't have the forecast for next year yet but I am
convinced it will be better than this year. The good price will
provide good incentives for farmers to grow rice. Since the local
rice price is no longer subsidized by the government, it has
risen sharply," he said.

"The rain has also improved. The reason Indonesia had to
import a lot of rice last year and this year was because of the
drought. Late planting means we have to import. If the planting
is late by two months, it means we have to import around four
million tonnes," he said.

Slayton & Associates, a leading U.S. rice consultant company,
has forecast that Indonesia would import two to four million tons
of rice next year compared with 6.25 million tons projected for
this year.