The National Food Agency (Bapanas) has assigned Perum Bulog to import 2 million tonnes of rice this year. Quoting CNBC Indonesia, the assignment was the result of an internal meeting with President Joko Widodo on Friday (24/3) which was stated in a copy of the letter.
Following up on the results of an internal meeting with the President on 24 March 2023 on the topic Availability of Staple Materials and Preparation for the 1444 H Eid Homecoming, we assigned Perum Bulog to procure 2 million tonnes of government rice reserves (CBP) from abroad until the end of December 2023. Procurement The first 500 thousand tons to be carried out as soon as possible," wrote a copy of the letter signed by the head of the Babanas Arief Prasetyo Adi.
Still from the copy of the letter, it was stated that the additional supply of rice could be used for the Stabilization of Rice Food Supply and Prices (SPHP) program, rice assistance to around 21.353 million beneficiary families (KPM) and other needs.
"The procurement of rice from abroad is to maintain the interests of domestic producers and pay attention to aspects of accountability and good governance in accordance with statutory provisions," continued the contents of the copy of the letter.
Bapanas reminded Bulog to maintain the interests of domestic rice. "In line with this, we have assigned Perum Bulog to continue to optimize the absorption of domestic production, especially during the March-May 2023 Harvest," said the letter.
Separately, Head of the Logistics Agency (Bulog) Budi Waseso confirmed the import duty of 2 million tonnes of rice. However, he is still waiting for permission from the Ministry of Trade (Kemendag).
"We don't know when it will come (imported rice) because the permit has not been issued by the Ministry of Trade," said Budi at the DPR building.
Meanwhile, Agricultural Observer from the Indonesian Political Economy Association (AEPI) Khudori said the import decision was actually quite a dilemma. The reason is, currently farmers enjoy high grain prices. Remembering that usually during the main harvest prices are depressed.
"Of course this benefits farmers," said Khudori. On the other hand, Bulog has difficulty absorbing it due to high prices. Until March 24, Bulog had absorbed only 48,513 tons of rice. Meanwhile, this year, Bulog is targeted by Badanas to absorb 2.4 million tonnes of domestic farmers' rice, of which 1.2 million will become year-end stock. Of that target, 70 percent of it is expected to be absorbed during the main harvest until May.
"Considering the conditions on the ground, it is almost certain that this target will be difficult to meet. Including the target of absorbing 70 percent of the 2.4 million tons of rice during the main harvest. Meanwhile, the best opportunity for Bulog procurement is during the main harvest. If absorption during the main harvest is missed or not achieved "The target is almost certainly not achieved," he explained.
Last week, only 280 thousand tonnes of CBP were in Bulog's warehouses. This amount is very small, because starting from March to May, Bulog will have to distribute rice social assistance (bansos) to 21.35 million underprivileged families.
In this assistance, each family will receive 10 kg of rice. This means that 630 thousand tons are needed. 000/kg and Rp 9,950/kg for rice at the Bulog warehouse. But the price of unhusked rice and rice in the market is still higher than the HPP," he said.
Khudori added that Bapanas and the Coordinating Ministry for Economic Affairs had put together dozens of large and medium mills to help increase Bulog's rice absorption.
They were asked to commit to helping Bulog. But the commitment that can be bound is not large, only 60 thousand tons. Apart from not helping much, these methods may also be unfriendly to the market. The government must throw away ways that are not friendly to the market. It is possible for Bulog to absorb it through a commercial mechanism.
"If this is taken, the number of CBP may improve. But this step is tantamount to pushing Bulog to aggressively enter the market and compete with other business actors, both rice mills and rice traders, to fight over grain/rice," he said.
This move was clearly inappropriate and violated the basic principles of Bulog's existence. This method will only make the price be attracted to the alias will be higher. Therefore, he suggested that there should be serious efforts to boost production and productivity. Production from 2018 to 2022 continues to decline.
Productivity did increase, but minor. This year, production challenges are expected to be much more difficult than last year, which was still experiencing La-Nino.
"This year, starting in April there will be an El-Nino, which, if you refer to experience, production usually drops," he said.
