Prices of a number of basic necessities have skyrocketed. This phenomenon has given a signal for the transmission of rising global food prices to local food commodities.
By
KOMPAS EDITOR
·3 minutes read
Kompas/Wawan H Prabowo
Vegetable traders serve chili buyers at the Kebayoran Lama Market, Jakarta, Sunday (12/26/021). Five days before the turn of 2021 to 2022, a number of prices for vegetables and other basic needs have increased.
The prices of a number of staple foods, such as cooking oil and red chilies, were out of control during this Christmas. The Trade Ministry recorded that the staple food commodities whose prices had soared were cooking oil, red chilies, broiler eggs and red onions. As of 24 December 2021, the price of bulk cooking oil rose 3.49 percent on a monthly basis to Rp 17,800 per liter, above the highest retail price of Rp 11,000 per liter (Kompas, 27/12/2021).
The above-mentioned price spike is only a partial portrait of the existing problem. The drastic increase in prices has actually been warned by various circles since a few months ago. The warning is related to the upward trend in the global food price index issued by the United Nations Food and Agriculture Organization (FAO).
The food price index has been rising steadily since August last year. At that time the new index was still below the 100 mark, but then it became 108.8 at the end of last year.
The index continued to rise and dropped slightly in June-July, but then jumped up again. The index last November was 134.4, up 1.6 points (1.2 percent) from October and 28.8 points (27.3 percent) from November 2020. The latest increase marked the fourth straight month of gains in the global food price index and put the November index at its highest level since June 2011.
Kompas/Wawan H Prabowo
Buyers choose a variety of fresh vegetables at the Kebayoran Lama Market, Jakarta, Sunday (12/26/021). Five days before the 2022 new year, a number of prices for vegetables and other basic needs have increased. The increase in vegetable prices was triggered by the lack of supply from farmers affected by bad weather.
Among several food indexes measured in November this year, there was the most significant increase for grains and dairy commodities. This was followed by an increase in the sugar commodity index, while for meat and vegetable oil commodities it used to decrease. The price index of meat and vegetable oil only decreased slightly compared to the previous month.
Looking at all these commodities, we need to be on red alert because Indonesia has to import most of these commodities. The increase in global food prices will certainly raise local food prices. Wheat, milk, sugar, meat and others are products whose procurement in whole and in part must be imported from abroad.
We cannot do much, even for domestically produced palm oil. The price increase has no signs of stopping. Moreover, La Nina worsens some commodity production in the domestic market even though it is profitable for rice cultivation. The water supply is abundant.
The only thing that can be done is to stop the possibility of rent-seeking and aji mumpung (attempt to take advantage of opportunities for personal gain) in the supply chain. The government can prevent these crimes in addition to cleaning up the logistics system. The effect is not great, but at least it can still be carried out.
