Ministry of Trade: Rise in Rice Prices Triggered by Increasing Paddy Prices

The high rice prices over the past two weeks are suspected to be due to high paddy prices in the market. Jakarta (ANTARA) - The Ministry of Trade (Kemendag) states that the increase in rice prices in the last two weeks was triggered by the rising paddy prices at the farmer level and the increase in distribution costs. Director of Domestic Market Development at the Directorate of Domestic Trade, Kemendag, Nawandaru Dwi Putra, said that based on monitoring results from the Market and Basic Needs Monitoring System (SP2KP), the current paddy price is in the range of Rp7,600 to Rp8,000 per kilogram, which then drives up the retail rice price. “We need to report that the high rice prices over the past two weeks are suspected to be due to the high paddy prices in the market,” Nawandaru said during the Regional Inflation Control Meeting monitored online in Jakarta on Monday. Nawandaru added that the rise in rice prices is also influenced by increasing transportation costs and plastic packaging prices, which further add to the distribution burden. Kemendag assesses that this condition needs to be watched because rice is still one of the contributors to national inflation. In April, the rice commodity was recorded to contribute 0.02% to monthly inflation and 0.18% to yearly inflation. To maintain price stability, the government is encouraging the strengthening of stabilisation instruments through the Rice Food Supply and Price Stabilisation Programme (SPHP). Nawandaru hopes that local governments can coordinate with Perum Bulog so that SPHP rice distribution is carried out evenly and sustainably to people’s markets. “We hope that for the regencies/cities mentioned earlier, assistance from Bulog is also needed to deliver evenly and continuously,” said Nawandaru. According to Nawandaru, SPHP distribution is deemed necessary to be optimised directly to retailers in people’s markets. This has been done in the Minyakita distribution mechanism through BUMN assignments. Based on SP2KP monitoring, medium rice prices still vary between regions. In zone 1, the medium rice price is at Rp13,400 per kilogram, still below the Highest Retail Price (HET) of Rp13,500 per kilogram. However, in zone 2, the medium rice price reaches Rp14,500 per kilogram or 3.38% above HET, while in zone 3 it reaches Rp17,500 per kilogram or 13.05% above HET. Meanwhile, premium rice prices across all zones show an upward trend compared to the previous month. In zone 1, the premium rice price is recorded at Rp15,000 per kilogram or 0.38% above HET. Zone 2 reaches Rp16,300 per kilogram or 5.59% above HET, and zone 3 touches Rp20,000 per kilogram or 26.49% above HET. Kemendag emphasises that rice prices, both medium and premium, are the government’s main concern to maintain inflation stability and people’s purchasing power.