New rice floor prices expected in February
New rice floor prices expected in February
JAKARTA (JP): The new floor prices of rice are likely to be
announced at the beginning of the harvesting season next month,
said the chairman of the National Logistics Agency (Bulog), Beddu
Amang.
Unlike in previous years, Beddu said the new prices would
concur with farm input prices, which include fertilizers and
pesticides.
While Beddu refused to say how much, he said last November
that the government was planning to increase rice floor prices by
at least 10 percent.
Higher than the inflation rate, the increase was expected to
assure farmers of a higher real income for rice.
The government decided not to raise the floor prices of rice
last October, when market prices were considered high and
favorable enough for rice farmers.
The government usually announces new floor prices at the
beginning of the October planting season to protect farmers from
unusually low prices, though the new prices usually don't become
effective until the beginning of the following year.
The current price of unhusked rice, Rp 400 (17 U.S. cents) per
kilogram, was announced by the government in October, 1994, and
became effective this month.
The government usually sets the new prices of fertilizer prior
to the announcement of new floor prices for rice.
Beddu said the government decided to change the timing of the
new price announcements when rice farmers began to complain about
having to pay higher fertilizer prices.
He then added that Bulog, when procuring rice from farmers in
the next (1996-97) harvesting season, would apply stricter
quality standards.
"This will be different from the last two years when Bulog set
rather loose standards for the rice it bought from farmers,"
Beddu was quoted by the Republika daily as saying yesterday.
Bulog was set up by the government in 1967 to control the
distribution and importation of several basic foodstuffs --
including rice, sugar, wheat, corn and soybean -- to ensure
national food security and reasonable incomes for farmers.
Beddu said yesterday he was optimistic his agency would be
able to guarantee national food security this year.
Minister of Agriculture Sjarifudin Baharsjah said last month
that his office has set its rice production target at 52 million
tons, or four percent higher than the 1995 level.
Indonesia, formerly the biggest rice importer in the world,
became self sufficient in 1984. In 1994 however, unfavorable
climates and plant diseases forced the country to revert to
imports.
According to the Central Bureau of Statistics, production in
Indonesia fell by 3.2 percent to 46.6 million tons of unhusked
rice in 1994 -- the lowest level in 15 years -- from 48.2 million
tons in 1993.
The market has not yet fully recovered. Prices of rice in the
last sixth months of 1995 reportedly soared in many parts of the
countries, forcing Bulog to intervene through market operations
with rice supplies which were obtained from imports and other
sources.
Last November, Bulog's rice stocks reached 1.3 million tons.
Meanwhile, rice consumption is expected to increase by 1.5 to
2 percent per year due to an increasing population and the diet
changes brought about by better incomes.
Rice is currently the staple diet of nearly 90 percent of
Indonesia's 190 million people. (pwn)