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Rice surplus should be kept for domestic supply: Analysts
Though rice prices are soaring in the global market, the country's rice production surplus must not be used for exports, analysts say
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Though rice prices are soaring in the global market, the country's rice production surplus must not be used for exports, analysts say.
The surplus should instead be managed to meet domestic demand and be able to withstand increasing threats from global climate change, they said.
Economist Bustanul Arifin said although it was predicted the country would enjoy a rice surplus this year, in the months of June and July a harvest failure was likely to occur due to bad weather.
"It will be very unwise if the government is planning to export rice now," he said.
Indonesian Farmers Harmony Association (HKTI) committee member Rachmad Badjuri said he was more concerned about the impact of exports on the government's rice purchasing price, also known as HPP.
"We must manage the buffer stock carefully, so that we don't need to import rice anymore, which will also lead to a 'good' HPP," Rachmad said.
A good HPP, he said, would benefit farmers as they would get higher selling prices.
The HPP for dried rice husks is now at Rp 2,200 per kilogram, while the international price of rice has reached around US$700 per metric ton.
Earlier, Trade Minister Mari Elka Pangestu said the government was considering making the state logistics company Bulog the only firm that could export rice of certain quality and by approval of the ministry and the Agriculture Ministry.
The Agriculture Ministry estimated the rice production surplus in 2008 would reach about 2.3 million tons per month.
"But the amount is not enough yet to reach rice supply self-sufficiency. The safe level is around 2.6 to 2.7 million tons per month," the ministry's director general for food plants, Sutarto Alimuso, said.
He said the current rice stock was only enough for domestic consumption during bad harvest months.
Deputy chairman of the House of Representatives' Commission IV overseeing agriculture, Hilman Indra, said it was not the right time for the government to export rice as domestic needs had yet to be met.
"If domestic needs have been fulfilled (with a contingency stock in the event) the country is hit by disasters or prolonged drought, then the government can talk about exports, as long as it is conducted by Bulog so the government can always keep an eye on the process," Hilman said.
He said the House would further discuss the current situation and would asked the government to review its rice export plan.
Coordinating Minister for People's Welfare Aburizal Bakrie supported the rice export plan.
"I agree with the plan. If the domestic stock is adequate, then why don't we export it?" he said as quoted by Antara news agency.
Rice export, he said, should not harm farmers, so Bulog would play a significant role in buying the rice from farmers and exporting it.
