Rice production said to exceed target this year

JAKARTA (JP): Minister of Agriculture Soleh Solahuddin estimated on Tuesday that Indonesia's unhusked rice production this planting year would be 48.35 million metric tons, 4.5 percent higher than the government's initial target.

Soleh attributed the better-than-expected predicted harvest to the government's enhanced efforts to extend rice planting areas and increased productivity.

"I guarantee that we will have a good harvest in February. After that, we can flood the market with our rice," Soleh told a media conference.

The 48.35 million tons of unhusked rice could be processed into 29 million tons of milled rice. Indonesia's consumption of rice is expected to reach 30 million tons this year.

Soleh said that the country has about nine million tons of surplus stocks in the market at present, including that kept by farmers and rice millers and households.

"If added to the approximately two million tons held by the State Logistics Agency (Bulog), the rice stocks in the country reach a total of 11 million tons," he said.

The minister said that the 11 million tons of rice would be sufficient to meet domestic demand for five months. "But it does not mean that our stocks will run out after five months, because we will enjoy a big harvest in January and February," he said.

Soleh added that many people, farmers and traders, were still holding on to their stocks, hoping for better prices.

"Many well-off families bought rice, doubled or even tripled their monthly consumption last month due to rumors of a rice shortage in the country," he said, adding that such a practice had partly caused the sharp increase in the market rice price.

Domestic

The government plans to flood markets with the surplus stock in the hope of controlling the prices, he said. It also plans to reinforce domestic production by purchasing rice at market prices rather than basic prices.

Harvest failure earlier this year has prompted the government to import 4.1 million tons of rice. Contracts have been signed for 2.4 million tons of rice, of which 1.5 million tons have been delivered. The next batch of 400,000 tons is expected to arrive next month, while the other 500,000 tons will be shipped in November.

Of the remainder, 1.2 million tons will be procured through international bidding while the rest is expected to come through grants and loans.

Soleh also assured that there would be an adequate supply of foodstuffs for the upcoming Christmas, New Year and Idul Fitri festivities which all fall within a three-week period.

"We have anticipated the increasing demand during the three holidays, despite the decline in people's purchasing power," he said.

Soleh said that the government would import 30,000 live cows from Australia to meet the domestic demand during the holiday season.

He said the live cow import, which would cost about Rp 93.6 billion at the exchange rate of Rp 6000 per U.S. dollar, would be carried out by private companies.

"The Australian government has pledged to subsidize the exchange rate to make it Rp 6,000 per U.S dollar for the import. Private companies under the Association of Indonesian Meat Producers and Feedlots will import the animals at the subsidized exchange rate," he said.

The U.S. dollar is now trading between Rp 10,500 and Rp 11,500.

Soleh said that the import was needed because local production could not meet domestic demand.

He estimated that the country would need 59,028 tons of fresh beef, 1,250 tons of frozen meat, 80,650 tons of chicken meat and 71,383 tons of eggs during the festivities. (gis)