Rice distribution system 'should be streamlined'

Rice distribution system 'should be streamlined'

JAKARTA (JP): A city councilor has underlined the importance
of cutting the lengthy rice distribution chain to help reduce the
price of the essential commodity.

Djafar Badjeber of Commission B for economic affairs said on
Monday that market cooperatives should buy rice from Jakarta
branches of the National Logistics Board (Dolog) or directly from
producers themselves to streamline the distribution chain.

"If cooperatives can get rice directly from Dolog or the
farmers and then distribute it to vendors, the price from the
farm gate to the market will only rise by a maximum of 12
percent," he said.

Under the existing system, prices rise by an average of 20
percent as the rice is passed from suppliers to distributors to
agents, before it reaches the markets then finally the vendors,
he said.

Djafar said the more stages in the distribution chain the
higher market prices would be.

"It's because each link in the chain marks up the price
slightly so that they can make a profit from their involvement in
the trade," he said.

"Moreover, a number of unscrupulous suppliers, distributors
and agents are known to on occasion deliberately hoard rice
stocks to force prices up and increase their own profits," he
added.

Djafar said the main problem associated with encouraging
cooperatives to cut the number of links in the chain was that
they had insufficient funds to buy rice in large quantities.

He reiterated that the administration should find a way to
help cooperatives solve their financial problems in conjunction
with the banking industry.

Djojo Sutardo of the city regional economic bureau confirmed
on Monday that the supply of rice in Jakarta from producers in
West Java, Central Java and East Java had returned to normal
after being disturbed by the recent riots.

"There's no shortage of rice in the city because supply can
still meet demand," he said.

The demand for rice in Jakarta alone was estimated at an
average of 2,025 tons a day, while the daily supply of rice at
Cipinang central market alone was at least 2,000 tons, he said.

"The only problem is that people do not have enough money to
buy the rice," he said, adding that rice prices rose by an
average of 8 percent last week. (ind/cst)