High Rice Prices Are Predicted To Last Until April 2024

Rice (Photo: dock. Antara)

JAKARTA - Institute for Development of Economics and Finance (Indef) senior economist, Bustanul Arifin, estimates that rice prices will still be high until next April or when the harvest season arrives.

"My estimate is that the price of this rice will remain high until the April 2024 harvest season or in Ramadan," he said when contacted by VOI, in Jakarta, Thursday, February 22.

Furthermore, Bustanul said referring to data from the Central Statistics Agency (BPS), the rice monthly balance sheet will start to be positive in March 2024.

"The surplus will increase in April 2024," he explained.

Causes Of High Rice Prices

Bustanul said the current soaring price of rice was the result of disturbances that occurred during 2023. First, said Bustanul, the phenomenon factor of el nino became one of the determinants of the increase in rice prices.

As a result of this natural phenomenon, continued Bustanul, rice production in 2023 will decrease by around 1 million tons, because the harvest area will also decrease significantly by around 300,000 hectares.

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. This is a record high, 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.