The government needs to have a new strategy and policy for rice amidst the efforts to maintain prices at the farm and consumer levels as well as maintain food stocks.
By
KOMPAS EDITOR
·3 minutes read
Near the peak of the rice harvest in several regions as Kompas observed, the rice prices benefit farmers (Kompas, 14/3/2023). The farmers' rice has become a source of disagreement between large rice mill businesses and the State Logistics Agency (Bulog), as well as small rice mills.
President Joko “Jokowi” Widodo previously asked the National Food Agency to immediately set the sales price of dry unhusked rice for Bulog. The aim was to prevent prices from falling at the farm level (Kompas, 12/3).
The government's rice policy so far has been to keep rice productivity high to meet the national demand for carbohydrates. The government provides incentives to farmers with subsidies for fertilizers and pesticides, building irrigation networks, and maintaining unhusked rice prices at the farm level. It is maintaining the price of unhusked rice, in addition to providing rice production incentives for farmers, while keeping prices affordable for consumers, especially the working class.
We have faced the same problem over the last several years whenever the harvest season arrives. Farmers complain of the falling prices of unhusked rice, while Bulog has difficulty getting rice because it is unable to compete with the prices of rice mills or rice traders.
We have faced the same problem over the last several years whenever the harvest season arrives.
The government’s policy on maintaining food security is based exclusively on the availability of rice as a source of carbohydrate, even though Indonesia is rich in various sources of carbohydrates. This policy needs to be reviewed for better food security in the midst of climate change, public health, and farmers’ welfare.
President Jokowi's attention to the balance between production, consumption, the prices for farmers and consumers, and national food stocks are reflected in the presence of the National Food Agency. The President ordered the agency to make a price strategy as a basis for its food policy, especially on rice.
LITBANG KOMPAS/ALBERTUS KRISNA
Farm workers harvest IR64 rice on Monday (23/4/2018) in Tirtoadi village, Mlati, Sleman, Yogyakarta.
Kompas" findings showed that the entry of investments for large mills has absorbed farmers' unhusked rice and raised prices at the farm level. However, prices at the consumer level still need to be maintained so that they remain affordable and do not lead to inflation.
In regulating prices, the government can strictly regulate the production and distribution of unhusked/husked rice, or free them altogether. Another policy option is to control production and distribution, given that the government subsidizes the rice production process, so rice cannot be traded freely.
One alternative policy is to restructure the rice trade system by, for example, setting a quota for rice that must be sold to Bulog, which must buy the grain at competitive prices. The role of maintaining rice stocks should involve local administrations and state-owned food businesses.
Furthermore, Bulog’s task is to provide rice for people who cannot afford to buy it at market prices and to the government’s rice reserves.
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