Rice Export to Start This Month

By : Sapariah Saturi Harsono

THE export is important to stabilize rice price domestically. INDONESIA was once known as a staple food importer. It annually bought overseas rice, corn, flour, soya bean, etc. During the President Suharto era, his administration improved food production in a bid to be self-sufficiency.

Last year, Indonesia totally stopped importing rice, its most important staple food. According to Statistics Indonesia, unhusked rice production reached 60.26 tones last year.

This year, the Ministry of Agriculture estimated that the national unhusked rice production might reach 63.5 tones or around 35.9 tones of rice. National consumption is around 30.9 tones. The surplus is around five tones.

In a bid to prevent the rice price declining, the government plans to export the surplus rice. It will export the premium rice. Some countries, including Japan, Hong Kong, Singapore and Brunei Darussalam, have indicated their eagerness to buy Indonesian rice. The government does not want to export the medium quality rice, as it wants to wait the local market secured. The government really wants to be sure that the surplus will reach five tones.

Bulog, Indonesia's state-owned logistic company, is going to be the sole rice exporter. Bulog President Director Mustafa Abubakar recently said that Bulog plans to export premium rice, between 10,000 and 20,000 tones per month.

"Rice with the super quality, like Cianjur and Aromatik, are favorable overseas. Japan already sampled the rice from East Java and Central Java," he said.

The premium rice export also demands that its broken grain is fewer than five percent. Now Bulog is working with companies prepared to export the premium rice. He said the would-be exported rice basically belong to private companies. But Bulog is the only company in Indonesia given the permit to export rice. "The export, probably starting in February, but we are still waiting for the permit from the Ministry of Trade," he said.

He described that Bulog chose the premium rice on the grounds that its market is segmented while its price range wide. Medium quality rice also has its market in the Philippines, Malaysia and East Timor.

Agriculture Minister Anton Apriyantono said Bulog could actually export rice without waiting for the final result of national rice production. The export is important to stabilize rice price domestically. "If the rice production is plentiful, it will trigger the price to decline. Farmers will get the impact." His ministry estimates that the surplus this year will be 3.8 tones higher than the 2008 production.

Economist Bustanul Arifin of the Lampung University, however, cautioned the government on the rice surplus. He said Statistics Indonesia's calculation method is questionable. The method did not change over the last two decades.

He stressed that the statistic agency never calculate the land conversion as well as natural disaster. They changed the farming areas. "Rice production, ironically, always increase as we see more and more natural disasters," he said.

Statistic Indonesia only calculates the areas of rice fields, increasing the figures years after years. "It's true that the rice production in 2008 was plentiful. It actually happened because our rice consumption was lower than the rice production. It creates some surplus"

Let's hope that the Statistic Indonesia's prediction is to be correct, or at least, the rice production will be the same with last year's figure. If it is to happen, at least, the rice self-sufficiency situation will be longer, not just one or two years. It should also be accompanied by diversifying the staple foods.

From: Indonesia Rising, 2 February 2009