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Bulog to adopt new approach for better absorption of farmers' rice
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Farmers carry bushels of harvested rice to a mill on Oct. 13, 2017 in Ngawi, East Java. (Antara/Ari Bowo Sucipto)
T
he National Logistics Agency (Bulog) has said on Wednesday that it will change its approach in purchasing rice to enable it to absorb more unhusked rice from farmers, according to a kompas.com report.
Bulog purchased 2.1 million tons of unhusked rice from farmers last year, or a mere 57 percent of its 2017 target of 3.7 million tons.
Bulog procurement director Andrianto Wahyu Adi said on Wednesday at the Agriculture Ministry that the agency could not optimally purchase rice from farmers as part of the government’s mechanism to control the prices of unhusked rice from farmers, as it had to wait for the farmers to sell their rice.
In terms of the agency's change in approach, he said Bulog would no longer use the public service obligation (PSO) mechanism, with prices determined by the government, to purchase unhusked rice from farmers this year. Instead, the agency would buy the commodity at commercial prices.
“If we use commercial prices, we can buy rice according to market prices. We hope that the prices will [thus] be more competitive,” Andrianto said.
He said Bulog planned to buy 2.7 million tons of unhusked rice in 2018, after taking into account last year's absorption rate, which fell well below target.
He said the agency was no longer tasked with distributing subsidized rice to low-income households, following the government's decision to distribute assistance through a cashless mechanism. (bbn)
