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Jakarta Post

Calls mount to keep staple food prices low ahead of Ramadan

Businesspeople and experts are urging the government to control the prices of basic commodities, which have started to increase a month before Ramadan

Made Anthony Iswara (The Jakarta Post)
Jakarta
Mon, March 30, 2020

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Calls mount to keep staple food prices low ahead of Ramadan

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usinesspeople and experts are urging the government to control the prices of basic commodities, which have started to increase a month before Ramadan.

Traditional Market Vendors Association (APPSI) vice chairman Sarman Simanjorang said a recent wave of panic buying had caused a decline in the supply of basic commodities, with people buying more than usual over fears that the government’s effort to mitigate the spread of COVID-19 could disrupt the supply chain.

“Honestly, we’re all panicking in the face of this coronavirus. Everyone is burdened, especially the public. Don’t make the people worry about an insufficient supply of basic necessities amid this current difficult situation,” Sarman said on Thursday, adding that the government must maintain the people's purchasing power.

The APPSI vice chairman’s woes echo similar calls to ensure there is a sufficient supply of staple goods during the Ramadan and Idul Fitri holiday season when demand for food increases sharply. Ramadan is expected to begin on April 24, yet prices have risen well in advance.

The average price of garlic nationwide almost doubled to Rp 44,500 (US$2.75) per kilogram on Thursday from between Rp 25,000 and Rp 30,000 per kg in January, according to the Information Center for Strategic Food Prices (PIHPS). The coronavirus has been blamed for disrupting garlic imports from China, causing a shortage of supplies that has in turn led to a sharp increase in prices of the commodity.

The increase in garlic prices, among other commodities, led to an increase in headline inflation in Indonesia to 2.98 percent in February from 2.68 percent in January. Volatile food inflation was recorded at 6.68 percent in February year-on-year (yoy), while core inflation was steady at 2.76 percent.

Sugar prices sat at Rp 17,650 per kg, exceeding its price ceiling of Rp 12,500 per kg. The Center for Indonesian Policy Studies (CIPS) said in a statement on March 20 that the sharp price increase was caused by a thinning supply, with the government late to import sugar.

Vegetable and Fruit Importers and Exporters Association (Aseibsindo) data show that retail prices of brown onion leaped to Rp 170,000 per kg in March, a sharp increase from Rp 62,500 per kg in February and Rp 35,500 per kg in January as the commodity sees a rising shortage.

Rice, the country’s staple food, has been stagnant at around Rp 11,850 per kg. The State Logistics Agency (Bulog) said there were still 1.5 million tons of rice in its warehouses and it expects to have around 7.7 million tons by the end of May after harvesting begins in March.

Meanwhile, bird’s eye chili declined to Rp 42,050 per kg on Thursday from around Rp 50,000 per kg in mid-January and mid-February.

While he claimed that the prices in the market saw “normal” increases of 5 to 10 percent, Sarman of APPSI criticized a recent clash of policy between the Trade Ministry and the Agriculture Ministry.

Last week, the Trade Ministry temporarily removed licensing requirements for imports of garlic and brown onion to increase supply and stop the prices of the two commodities from soaring. As a result, importers no longer needed import recommendations for horticulture products, Trade Minister Agus Suparmanto said in a teleconference.

Yet, the Agriculture Ministry said in a statement on March 21 that the Trade Ministry’s new policy still needed to adhere to a 2010 law that requires horticulture product imports to follow several requirements, including an import recommendation from the Agriculture Ministry.

Nevertheless, the Trade Ministry said in a statement on Wednesday that the average prices of rice, cooking oil, wheat flour, soy, eggs and red onions were “relatively stable” as of March 24. It also noted that chicken meat, curly red chili and large red chili prices decreased compared to the previous month.

“In general, the supplies of basic food products are sufficient to meet needs during the fasting month and Idul Fitri in 2020. We are currently trying to increase the stock for sugar and garlic through importers and state-owned enterprises,” the Trade Ministry’s director general of domestic trade, Suhanto, said as quoted by a press release.

The Trade Ministry had imported 11,000 tons of garlic as of March 19 out of the 150,000-ton quota. The ministry also gave assurances that there would be enough sugar to last until June.

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