Rice Prices Continue To Skyrocket, Indef: There's Mafia 9 Dragons

JAKARTA - Rice prices are currently soaring. The control of the rice market by a handful of large companies is allegedly the cause of rice prices not falling even though the government is diligent in importing millions of tons of rice.

Executive Director of the Institute for Development of Economics and Finance (Indef) Esther Sri Astuti explained, the current high price of rice is due to limited supply.

In addition, the dominance of the domestic rice market is controlled by a handful of conglomerates, instead of being controlled by the state through Perum Bulog.

"The cause is due to the lack of rice supply in the global market and the existence of mafia (9 dragons) for food in Indonesia," Esther told VOI, Monday, February 12.

Esther assessed that the 9 dragon mafia came from the private sector. Even so, he could not reveal his name list because he did not have accurate data.

"I don't know who the mafia is because I don't have the data," he said.

In addition, said Esther, another reason that makes rice prices soar at this time is Indonesia, which is still dependent on rice imports. "(The other cause) Indonesia imports rice from other countries," he said.

Furthermore, Esther revealed that there are a number of long-term solutions that the government can do to overcome this. One of them is by boosting domestic rice production.

"The solution to increasing domestic rice production (can be done) through three (3) strategies, namely conducive regulations for the development of the agricultural sector, increasing marketing capacity and creating alternative livelihoods for farmers so that they have side income," he added.

Based on the National Food Agency (Bapanas) Panel, Monday, February 12, 2024, at 17.45 WIB, the price of premium and medium rice has again moved up away from the highest retail price (HET).

HET rice set by the government is IDR 10,900 to IDR 11,800 per kilogram for medium rice, while premium rice is IDR 13,900 to IDR 14,800 per kilogram.

The price of premium rice this afternoon rose 0.77 percent to Rp15,750 per kilogram and medium rice rose 0.88 percent to Rp13,830 per kilogram.

The retailer also felt the high price of rice. The Indonesian Retail Entrepreneurs Association (Aprindo) revealed that it was starting to have difficulty getting a supply of 5 kilograms of premium rice.

Chairman of Aprindo Roy N Mandey said that currently rice producers have raised their purchase prices, because the rice harvest period is predicted to take place in March 2024 and rice imports have not fully entered.

In addition, this unbalanced supply and demand has triggered an increase in rice prices in the retail market and people's markets. "Peritel is starting to have difficulty getting local premium-type rice supplies with 5 kilograms of packaging," Roy said in a written statement.

Therefore, retailer associations ask for government considerations to relax the Highest Retail Price (HET) and reference prices for several food commodities that have the potential to increase in February 2024.

The commodities in question include rice, sugar, cooking oil and so on.