High Rice Prices Impact Of Disturbances That Occur In 2023

Rice (Photo: dock. Antara)

JAKARTA - Institute for Development of Economics and Finance (INDEF) senior economist, Bustanul Arifin, said that the current soaring price of rice is the result of disturbances that occurred during 2023.

First, said Bustanul, the el nino phenomenon factor is one of the determinants of the increase in rice prices. As a result of this natural phenomenon, rice production in 2023 fell by about 1 million tons, because the harvest area also decreased significantly by around 300,000 hectares.

Regarding the current conditions, Bustanul admitted that together with other analysts, he had reminded the government to anticipate the phenomenon of el nino which caused this extreme drought.

As is known, this el nino phenomenon causes disruption during the planting season. Where the planting period becomes backward which results in the postponement of the harvest season.

"I and several analysts have conveyed since 2023, reminding the Government to anticipate this extreme drought," he told VOI, in Jakarta, Thursday, February 22.

The second factor, he said, is the global rice economy. In July 2023 India banned rice exports. The consideration is that PM Modi will face the election in 2024.

"He doesn't want India's domestic rice price to rise significantly. PM Modi also enjoyed the effects of reporting after several countries came to India, negotiated, asking to be excluded from the policy of banning rice exports. For example, the countries that have come to Delhi are Singapore, Butan, Mauritania and others," he said.

As a result, continued Bustanul, world rice prices also rose very high. In fact, exceeding 620 US dollars per tonne for medium rice and 680 US dollars per tonne for premium rice. In fact, this is the highest record, exceeding the price during the 2008 Food Crisis.

"We understand, in 2023 there are too many incidents that occur at the same time. Especially political, legal, and other events that I think interfere with the implementation of food and other economic policies," he said.