The Jakarta Post
The uproar and spat between senior officials over the last few days over the import of 2 million tons of rice for the national food reserves reiterates how politically charged this staple commodity has always been, as it is the main food for the poor among 260 million Indonesians and in several other Southeast Asian countries.
Then-trade minister Gita Wirjawan resigned in April 2014, an election year, due to the political noise over the alleged smuggling of 16,000 metric tons of rice into the country, though just a tiny fraction of the estimated national consumption of 32-33 million tons.
The latest uproar over rice imports erupted after the chief of the State Logistics Agency (Bulog), Budi Waseso, insisted rice imports were no longer needed, as stocks were more than enough while the agency’s warehouses could not accommodate additional reserves.
The different views between the Bulog chief on the one hand and Coordinating Economic Minister Darmin Nasution and Trade Minister Enggartiasto Lukita on the other once again reveals different views on the management of national rice reserves, because the import was agreed in an economic coordination meeting.
The Supreme Audit Agency in May had expressed doubt about the accuracy of data on rice production and consumption at various government institutions involved in formulating food policies. Darmin again asserted Wednesday that the Agriculture Ministry often erred in its forecasts on annual rice production and that production this year looked to be lower than initially estimated.
President Joko “Jokowi” Widodo seems to be obsessed with achieving rice self-sufficiency, even though experiences over the past 50 years have shown that it is rather impossible to maintain rice self-reliance all the time in the world’s largest archipelago. Rice crops, which are harvested twice annually in Java and only once outside Java, are vulnerable to pests and weather anomalies.
Rice remains a “thinly” traded commodity — most countries grow what they eat, and the United Nations Food and Agriculture Organization (FAO) has estimated that only around 5 percent of global production is traded across borders. Thailand and Vietnam are the largest exporters.
Since rice is our main staple food, weighing heavily in the consumer price index (inflation), the government has assigned Bulog to manage national rice reserves as a tool to maintain price stability. Certainly, the efficiency and effectiveness of the stock management depends on the accuracy of domestic production and consumption, so that the volume of reserves is just enough to protect the country from volatile world prices or low production.
The policy of controlling rice prices within an annually-reviewed range of minimum and maximum prices to ensure fairness for both consumers and producers and importing rice only as a contingency measure has been considered fairly adequate. But there should be a national consensus on the threshold for importing rice, otherwise rice imports will always cause unnecessary political rows, especially in election years.