The Jakarta Post
The South Sumatra chapter of the State Logistics Agency (Bulog) is facing difficulties in reaching its rice absorption target of 70,000 tons this year despite harvest season.
The agency had only been able to absorb 180 tons of rice as of early March due to the rising price of rice at the farmers’ level, also known as the “farm gate price”, said the chapter head, M. Yusuf Salahuddin, in Palembang, South Sumatra, recently.
Raw rice, which is not qualified yet as medium or premiumquality rice, is sold at above Rp 8,300 (58 US cents) per kilogram on average.
“The low absorption is because farmers sell their rice at a higher price than the regulated farm gate price of Rp 7,300, with the flexibility reaching Rp 8,030 at maximum [lower than the actual farm gate price of Rp 8,300],” he said.
He said Bulog had purchased the 180 tons of rice based on the commercial price as it had to follow regulations on rice prices.
Bulog has earmarked Rp 10 trillion for rice purchases nationwide this year.
In terms of logistics, Yusuf ensured that Bulog’s warehouse in South Sumatra would be able to store more rice, saying that currently it housed 27,500 tons of rice, including the stock from last year. Aside from local rice absorption, some of the stock also came from East Java, he said.
The existing stock is expected to fulfill people’s needs for the next seven months.
The stock will also be distributed through several programs, such as the social assistance fund (Bansos), rice assistance (Rastra) and direct market operations through traditional markets.
“We have distributed 4,000 tons of rice through the Bansos and Rastra programs in 2019 so far. We will continue to distribute our stock,” Yusuf said. (bbn)