Rice import ban to be extended

The Jakarta Post, Jakarta

The Ministry of Agriculture has asked the Ministry of Industry and Trade to extend the ban on rice imports until August as rice stocks are currently sufficient to meet national demand for the commodity.

"Rice stocks are now at an adequate level in all provinces, thanks to good harvests," Director General of Food Plant Production Supervision at the Ministry of Agriculture M. Jafar Hafsah was quoted by Antara as saying on Thursday.

He said national rice stocks totaled six million tons to seven million tons, including 1.9 million tons to 2 million tons held by the State Logistics Agency (Bulog) and four million tons to five million tons held by traders and farmers.

With national consumption of 2.5 million tons per month, stocks were adequate for a few months' consumption, he said.

Furthermore, quoting a prediction by the Central Statistics Agency (BPS), Jafar said national unhusked rice output was expected to increase to 53.67 million tons this year from 52.8 million tons last year, thanks to good harvests.

The Ministry of Industry and Trade first imposed a ban on rice imports in January, effective until June 1, in order to protect farmers and help improve their welfare. It later extended the ban until July.

Under the current system, the Ministry of Agriculture has the right to decide whether or not rice imports should be banned. However, the Ministry of Industry and Trade issues the decree to implement the decision.

In past years, the country imported 1.8 million tons to 2 million tons of rice per year. Some analysts have criticized the import ban policy, arguing it will raise the price of rice at home and eventually hurt farmers as they are also net consumers of rice.

The critics said government policies should aim at boosting the productivity and efficiency of the agriculture sector in order to help farmers compete with cheaper, imported rice products.

However, Jafar said the import ban had proved effective in raising the price of local farmers' rice, adding that farmers now sell their unhusked rice at around the government-set price level of Rp 1,230 (about 13 US cents) per kilogram. Prior to the import ban, farmers usually sold their rice more cheaply in order to compete with low-priced imported rice.