They request the government to review the 1-million-ton rice import plan because even before its realization, this plan has had a market psychological effect that lowers their unhusked rice prices.
By
KOMPAS TEAM
·5 minutes read
Several regions are entering bumper harvests. Farmers are anxious because prices of their unhusked rice are plummeting. The plan to import 1 million tons of rice affects the market psychology, thus putting pressure on farmers’ unhusked rice prices.
CIREBON, KOMPAS — Farmers in various regions are worried as buyers bid low prices for their unhusked rice. They request the government to review the 1-million-ton rice import plan because even before its realization, this plan has had a market psychological effect that lowers their unhusked rice prices.
Based on Kompas’ monitoring in West Java and East Java on Thursday (18/3/2021), a number of regions are entering the bumper harvest season. Farmers are complaining about prices of dry unhusked rice ranging from Rp3,200 to Rp3,700 per kilogram, far below the government purchase price of Rp4,200 per kg.
In Cirebon regency, West Java, the areas entering the bumper harvest season are among others Palimanan, Gempol and Suranenggala. Farmers are busily drying unhusked rice in house yards and village roads. “Even before the rice import, unhusked rice prices have dropped. What happens after the import?” said Suharno, 55, a farmer in Tegalkarang village, Palimanan.
At the unhusked rice price of Rp3,300 per kg, farmers would get Rp19.8 million per hectare with the land productivity rate of 6 tons per hectare.
Chairman of the Indonesian Farmers Association (HKTI) of Cirebon regency, Tasrip Abubakar, said the farmers’ unhusked rice price slump was inversely proportional to the crop planting cost. He continued that farmers’ planting cost in Cirebon could now reach Rp10 million per hectare. At the unhusked rice price of Rp3,300 per kg, farmers would get Rp19.8 million per hectare with the land productivity rate of 6 tons per hectare. “More than 40 percent of farmers are tenants. The rentals they pay range from Rp15 million to Rp18 million per hectare per year. So, if the unhusked rice costs Rp3,300 per kg, farmers have to cover the shortage of Rp9 million,” he added.
According to Tasrip, farmers’ plummeting unhusked rice prices are triggered by the government’s rice import plan. “Unhusked rice prices can still plunge only 25 percent of the regions are harvesting and the warehouses of the State Logistics Agency (Bulog) are still packed,” he indicated.
In East Java, Chairman of the Farmers and Fishermen Group of Madiun regency, Suharno, said Madiun had entered the bumper harvest season and usually it would start earlier than other regions so that farmers’ unhusked price was also higher because the stock wasn’t yet abundant. “But at present farmers’ unhusked rice only sells at Rp3,200-Rp3,300 per kg,” he said.
The price is far lower than the government purchase price of Madiun’s dry unhusked rice of Rp3,750 per kg. Suharno described the policy plan to import 1 million-1.5 million tons of rice as very inappropriate. While it is to be done amid the bumper harvest time, national unhusked rice output abounds due to the absence of significant disturbances during the process of January-April 2021 production.
Besides in Madiun, low unhusked rice prices are also faced by farmers in Gresik regency. In a bumper harvest program in Tambakrejo village, Duduk Sampeyan district, on Friday (12/3), Asman, 55, a representative of Gresik farmers, said their unhusked rice was priced at Rp3,200-Rp3,600 per kg. “Actually, the annual production cost is increasing,” he noted.
Statistics Indonesia (BPS) has estimated that national dry unhusked rice production during January-April 2021 will reach 25.37 million tons. The figures rise by 26.88 percent compared with the volume in the same period last year. The unhusked rice output projection is equivalent to 14.54 million tons of rice.
Apart from his limited floor capacity for drying, he also feared a higher rice price fluctuation this year following the rice import plan.
Rice hulling businessmen and rice traders also delay their purchase of unhusked rice with the government’s 1-million-ton rice import plan. A rice hulling plant owner in Tambakrejo, Sunardi, 45, said he didn’t dare to buy farmers’ unhusked rice yet. Apart from his limited floor capacity for drying, he also feared a higher rice price fluctuation this year following the rice import plan.
Chairman of the Johar Market Rice Traders Association of Karawang, Sri Narbito, in Karawang, West Java, described the rice import plan as indeed having a psychological effect on market prices now already under the pressure of the bumper harvest season. Sri added that rice supply at the Johar rice market had over the past month increased from 500 tons per day
on average to 800 tons per day. The growing rice supply especially comes from Demak, Central Java, and Indramayu regency, West Java, which are now harvesting. “If the price trend is declining, middlemen buying rice tend to reduce their purchases in order to lower the risk of plunging prices,” said Sri.
Optimizing absorption
At a working conference with Commission IV of the House of Representatives (DPR) in Jakarta on Thursday, Agriculture Minister Syahrul Yasin Limpo said his ministry had asked regional heads to optimize the function of drying facilities in production centers. He also hoped that Perum Bulog (state logistics enterprise), regional administrations and rice hulling plants would optimize the function of the existing warehouses and granaries. “In order to properly maintain prices at the farmers’ level, the Agriculture Ministry is arranging anticipatory measures, particularly for the rice commodity,” said Syahrul.
Earlier, Perum Bulog stated its commitment to absorb domestic farmers’ rice production despite the assignment from the government to import 1 million tons of rice this year. Perum Bulog President Director Budi Waseso at a working conference with the DPR Legislation Body on Tuesday (16/3) said his enterprise had been tasked with importing rice in writing by the government. In detail, 500,000 tons of the import are for the government’s rice reserves (CBP) and 500,000 tons for Bulog’s commercial rice.
Nonetheless, Commission IV of the DPR keeps rejecting the government’s 1-million-ton rice import plan. This stance was the conclusion of the DPR Commission IV’s hearing with the Agriculture Minister.(IKI/MEL/NIK/WER/JUD)