Rice output exceeds target, RI may start to export: Official

Yuli Tri Suwarni and Zakki P. Hakim, The Jakarta Post/Bandung/Jakarta

The country's rice production, as of July, already surpassed the full-year output target, with one official even suggesting that Indonesia could start to export it because of an expected surplus.

Unhusked rice production reached 53.67 million tons, or 0.67 million tons more than the 2004 target of 53 million tons, Director General of Agriculture and Food Crops at the Ministry of Agriculture M. Jafar Hafsah said on Wednesday.

He said that was the equivalent of 33 million tons to 34 million tons of husked rice, which was more than sufficient to meet annual domestic demand of around 31 million tons.

"We now have a surplus of around 3 million tons that we could keep as buffer stock or, even better, for export," he told a media conference in Bandung.

Jafar expected that total unhusked rice production could further increase to around 54 million tons this year depending on the weather during the remainder of the year.

"A good harvest was possible due to improvements in irrigation and fertilization," he said.

The exportation of rice, however, might be quite a challenge for Indonesia as the local rice price is higher, at Rp 2,500 to Rp 3,000 per kilogram, while the international price ranges from Rp 2,000 to Rp 2,400 per kilogram, Tungkot Sipayung, special assistant to the Minister of Agriculture, told The Jakarta Post.

"There is no way we could compete with that (international) price as we have no funds available to subsidize exports," he said.

Therefore, Tungkot said, the government might opt to export in the form of rice loans to other countries under South-to-South or bilateral cooperation.

Malaysia, Timor Leste and Papua New Guinea were likely targets as they had a rice consumption per capita similar to Indonesia's, he said.

Last year, Indonesia, with its population of 220 million people, consumed 135 kilograms (kg) of rice per capita, he said.

The nation first reached self-sufficiency in rice in 1984, but the following year started to import rice again to meet domestic needs because of declining output. Imports hit a record 6 million tons at the peak of the economic crisis in 1998. They then declined to 1.8 million tons to 2 million tons annually in the following years.

The government, since early this year, has banned rice imports in a bid to protect local farmers from cheaper rice imports. The import ban will be maintained until at least the end of this year.