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Chicken farmers call for corn imports to stabilize feed prices
Corn used for animal feed can only be imported by a state agency, but farmers say that must change to bring down their operational costs.
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N
ational Food Agency (Bapanas) head Arief Prasetyo Adi has raised the alarm over a surge in the price of chicken due to the high price of corn, which is the main input for chicken feed.
President Joko "Jokowi" Widodo also pointed out the rise in chicken prices during a visit to a traditional market on June 26 and vowed to resolve the issue.
Herry Dermawan, head of the National Poultry Breeders Association (Gopan), said there was a shortage of corn in the market, with nationwide supplies expected to fall to 650,000 tonnes next month, well short of the monthly demand of around 800,000 tonnes.
"Feed suppliers have warned that the price will increase. Thus, the price of day-old-chickens [to be raised into mature chickens] will also increase," Herry said in an online interview with CNBC Indonesia on Monday.
Herry, who is also a member of the West Java Legislative Council (DPRD), called for the reopening of corn imports, arguing that it could help stabilize corn prices in the country until the harvest period brings additional supply.
According to Trade Ministry Regulation No. 21/2018, corn used for animal feed can only be imported by the State Logistics Agency (Bulog) at the direction of the government.
Read also: Prolonged oversupply, costly inputs to hamper poultry firms this year
"The government doesn't want to import corn so that they can maintain the foreign exchange. On the other hand, they asked us to replace corn with imported wheat, which provides less nutrition," Herry said.
Other groups, such as the Indonesian Poultry Farmers Association and Information Center (Pinsar) and the Association of Indonesian Political Economy Activists (AEPI), supported the initiative.
"If importing rice is allowed, why don't we apply the same thing for corn? Chicken meat and eggs are the cheapest source of amino acids. It's strange," said Musbar, an executive at Pinsar, as quoted by Bisnis.
Read also: Govt sets new food-reserves rules, potentially hurts Bapanas authority
Bapanas' Arief said the government would not open the door to imports so as to keep corn prices stable for the sake of domestic farmers. Instead, the agency would wait for the harvest and facilitate corn distribution from Sumbawa to Java to maintain a balance between supply and demand.
Bapanas has also instructed Bulog to reactivate the Corn Dryer Center (CDC), which can be used to stockpile corn in the harvest period to be used for intervention in the market when supply is low.
"We can stock 3,000 tonnes of corn per silo. That can serve as our reserve for food and animal feed. That is our task now," Arief said, as quoted by Kontan.
