Rice import ban extended to end 2005: Minister

Rice import ban extended to end 2005: Minister

Dow Jones, Jakarta

The government has decided to extend a rice import ban until the end of this year, according to a senior government official.

"We aren't worried about our rice stocks, so we've decided not to import rice unless conditions become extreme," Minister of Agriculture Anton Apriyantono said late on Wednesday.

"This policy will be reviewed at the end of the year to see if it will be extended again."

Anton said his ministry's criteria for "extreme" conditions included a decline in rice stocks to below one million metric tons and an average price of Rp 3,500 (36 U.S. cents) a kilogram for medium-quality rice.

National rice stocks as of June 20 totaled 1.8 million tons, while the current average price of medium-quality rice is Rp 2,750/kg.

Indonesia will have rice stocks of 4.2 million tons by the end of this year, Anton said, citing ministry projections.

The government initially imposed the ban from January 2004 to July 2004, then extended it in August of that year until end- 2004, due to expectations of robust domestic output.

In December 2004, the government extended the ban to June 2005 due to official assessments of sufficient stocks and a good rice harvest.

The ban applies to only indigenous rice varieties and doesn't block imports of rice strains that aren't locally produced.

The ban's extension will likely disappoint Thailand and Vietnam, who have traditionally provided the bulk of Indonesia's rice imports.

The government's decision reflects its efforts to boost the incomes in its rural agricultural sector, which is dominated by smallhold subsistence farmers.

Indonesia has pushed for international trade policies supportive of developing countries' subsistence farmers through the Group of 33 developing countries, or G33.

The G33, a 42-nation grouping coordinated by Indonesia, reiterated earlier this month its intention to make the organization's special products and special safeguard mechanism, or SP-SSM, a cornerstone of negotiations in the World Trade Organization's (WTO) Doha Round.

The SP-SSM aims to protect developing countries' staple agricultural commodities, including rice, sugar and soybeans, from excess import-tariff cuts.

The G33 fears such cuts will trigger a flood of heavily subsidized imports from developed countries that could devastate subsistence farmers.

The Doha Round is likely to climax at the WTO ministerial meeting in Hong Kong in December.