UMY Expert: Free Nutritious Meal Programme Needs Upstream Food Sector Reform

An agribusiness lecturer at Universitas Muhammadiyah Yogyakarta (UMY), Dinda Aslam Nur Hida, has stressed the importance of reforming the upstream agricultural sector to ensure the sustainability of the Free Nutritious Meal (MBG) programme, rather than focusing solely on downstream distribution. Speaking in Yogyakarta on Friday, she noted that national food security challenges are currently complex, ranging from production gaps between commodities and low bargaining power among farmers to cash flow constraints for local food businesses partnering with the programme. She observed that the Farmer Exchange Rate (NTP) for the livestock subsector fell by 1.85 per cent in June 2026 due to rising costs of imported feed outpacing increases in selling prices. A similar situation occurred with rice, where farm-gate prices have exceeded government assumptions, triggering high retail prices. Dinda suggested the government use the increased demand generated by the MBG programme to consolidate small-scale farmers into institutions such as cooperatives, farmer groups, or Village-Owned Enterprises (BUMDes). “With institutional strengthening, supply contracts with Nutrition Fulfilment Service Units (SPPG) can be executed through forward contract schemes. Without this, the increased demand will only benefit middlemen, not farmers as primary producers,” she said. Beyond production issues, she highlighted liquidity hurdles faced by food MSMEs within government procurement schemes. Many businesses struggle with pre-financing due to lengthy payment settlement periods. Dinda recommended three strategic measures to reinforce the programme’s sustainability: aligning reference rice price regulations with actual market realities, integrating spatial data across 25,302 SPPG units with regional commodity potential mapping, and increasing investment in upstream infrastructure such as cold storage. “Success downstream must not come at the expense of the welfare of upstream agricultural actors. Strengthening the upstream sector is a prerequisite for ensuring the programme’s benefits are sustainable as an investment in Indonesia’s human capital quality,” she said.