Production drop forces Bulog to import rice

JAKARTA (JP): A decrease in the country's rice production forced the National Logistic Agency (Bulog) to import 900,000 tons of husked rice this year and another 380,000 tons is expected next month, State Minister of Food Ibrahim Hasan said yesterday.

He told a press conference here that out of the this year's imports, 600,000 tons were procured for the repayment of Indonesia's loans to other countries and the other 300,000 tons were under purchase agreements.

"The imports are necessary to prevent rice prices from soaring on the domestic market due to the decline in production," said Ibrahim, who is also chairman of Bulog.

Floods earlier this year, and a severe dry season afterwards, have slashed Indonesia's production of unhusked rice by 3.6 percent to 30.16 million tons this year.

Ibrahim said that Bulog's market operations have kept rice price developments under control thus far. During the last two years, for example, the average price of rice increased by only 16.8 percent -- far lower than the inflation rate of about 19 percent during the same period.

He said the rice imports are expected to increase Bulog's stock, which currently are estimated at about 550,000 to 600,000 tons.

The low level of stocks was caused by decreasing procurement conducted by Bulog, he said.

Decline

"Bulog's annual rice procurement steadily declined from 2.56 million tons in 1992 to 1.96 million tons last year and to 950,000 tons this year," he said.

The minister said that Bulog will likely procure about 1.6 million to 1.9 million tons of rice this year. "However, the figure may change, depending on several natural conditions," he added.

He said the government will continue its market operation in the coming few months because prices may have a tendency to rise before the harvest season beginning in March.

"We have thus far sold 800,000 tons of rice for this year's market operations," he explained.

Ibrahim said Indonesia's rice production is expected to increase again next year and rice prices, therefore, will be more stable than last year.

Minister of Agriculture Sjarifudin Baharsjah said last week that the country's production of unhusked rice would likely rise by more than eight percent to 50.15 million tons next year.

Ibrahim also said that in addition to rice, Bulog will import crude palm oil (CPO) and corn to help stabilize prices on the domestic market, particularly before and during the Idul Fitri holiday in March.

"I have asked for approval from the Minister of Agriculture on the imports of 150,000 tons of CPO from Malaysia in the coming two months," he said.

The price of CPO increased from Rp 1,030 per kilogram in January to Rp 1,230 per kilogram this month, he said. (icn)