Ministry of Agriculture allocates fund to buy farmers rice next year
Adianto P. Simamora, The Jakarta Post, Jakarta
The Ministry of Agriculture plans to allocate Rp 173 billion (US$19.9 million) in cash to buy unhusked rice from local farmers next year in a bid to help avoid the price of the commodity from dropping and help protect farmers income.
Director general for Food Security Ahmad Suryana said Friday that the government wanted the current favorable price level of Rp 1,500 per kilogram maintained next year.
He said that the House of Representatives had agreed to the plan.
"The Commission (House commission III on agriculture and food affairs) has in principle agreed to the proposal," Ahmad told The Jakarta Post.
He said that the money would be disbursed to village cooperatives through which most farmers sell their unhusked rice.
"Those village cooperatives would buy unhusked rice from local farmers during harvest time at the government-target floor price of Rp 1,500 per kilogram," Ahmad said.
Experts have repeatedly called on the government to adopt a new rice policy to maintain the stability of the price of unhusked rice.
Most farmers were often forced to immediately sell their rice after harvest to pay their debts and to purchase items for their daily needs, causing the price to drop below the floor price target.
Experts have said that many local farmers had been discouraged from planting rice due to the low price of unhusked rice during the harvest period.
Data from the Central Bureau of Statistic shows that the country's rice fields have shrunk to some 14 million hectares from 16.7 million hectares in 1983, a reduction of 15,000 hectares per annum.
This has been one reason why national rice output has been declining.
"We'll take various steps to help stabilize the price of unhusked rice so as to encourage farmers to plant the crop," Ahmad said.
The ministry has projected that next year's unhusked rice output would reach 54 million tons, higher than this year's target figure of 53 million tons.
Traditionally, the government assigns State Logistics Agency (Bulog) to procure rice output from farmers during the harvest period to stabilize the price.
Ahmad did not explain why the ministry had also launched a similar program.
Rice procured by Bulog is resold to civil servants and members of the Indonesian Military and National Police as part of their salary, and is also used for its open market operation to stabilize prices at the consumer level.
Bulog earlier said that the agency would procure three million tons of unhusked rice from local farmers this year.
The agency also plans to buy up to 10 percent of the total unhusked rice output next year.