The Government Must Anticipate The Spike In Commodity Prices In The Aftermath Of Strengthening The US Dollar

Photo by Daniela Paola Alchapar on Unsplash

JAKARTA - The government is asked to anticipate an increase in commodity prices due to the strengthening of the US dollar (United States) exchange rate against the rupiah. One of the commodities that will rise in the aftermath of the increase in the value of the US Dollar is soybeans, which are mostly food raw materials in Indonesia.

"The government can consider policies that control the import of goods that are sensitive to the rupiah exchange rate, such as soybeans which are raw materials for tofu and tempeh," said DPR Speaker Puan Maharani, Monday, October 23.

According to data from the Association of Indonesian Tofu Tempe Producers Cooperatives (Gakoptindo), there has been an increase in soybean prices at the level of craftsmen which has made the prices of the two foodstuffs soar in the market. The selling price of tempeh and tofu in the market for small pieces ranges from Rp. 2,500 to Rp. 3,000. Meanwhile, the larger discount is between Rp. 4,000 to Rp. 5,000.

Currently, the fulfillment of soybeans as raw material for tofu and tempeh for the country still relies a lot on imports. The increase in the price of imported soybeans is suspected to be due to the weakening of the rupiah exchange rate against the US Dollar which is the highest record this year. In fact, in recent days, the US dollar exchange rate against rupiah has almost reached Rp. 16 thousand.

Given that the influence of the US dollar on soybeans is very significant, Puan also encourages strengthening aid for soybean farmers. He asked the Government to intervene in an effort to boost local soybean production.

"Improving soybean production will have a positive impact on the country's economy and food security," said Puan.

Soybeans are not only raw materials for tempeh and tofu which are daily foods for the Indonesian people. Puan assessed that the increase in local soybean production will also help other food industries because soybeans are also used as raw materials for making soy sauce and animal feed.

"Ladies and gentlemen must feel the impact, because usually they know tempeh is served as daily food. If the price goes up, household spending will also increase. The family economy will also have an effect," he said.

Puan also highlighted the increase in the price of tofu tempeh and other commodities such as chilies which can have an impact on food business actors. Especially micro, small and medium enterprises (MSMEs).

"Food business actors cannot increase prices carelessly because they can affect buyers. So there must be adequate anticipation so that the increase in food prices does not harm MSMEs as a driver of the country's economy," said Puan.

On the other hand, Puan supports the existence of subsidies from the Government to reduce the price of soybean imports which will reduce the production cost of the craftsmen. He also encouraged subsidies to also be given to farmers as an effort to increase local soybean production.

"This step can help increase domestic soybean production, which in turn can support food security and reduce dependence on imports," said the former Coordinating Minister for Human Development and Culture.

Indonesia's dependence on imported soybeans can be seen from the stock of soybeans in the logistics affairs agency (Bulog) which is only 0.58 tons. Meanwhile, the monthly demand is projected to reach 212,548 tons.

Not only that, Puan also emphasized the importance of preventing domestic soybean trade from being controlled by cartels. He warned that soybean imports would not go too far.

"So don't keep imports. Because this is not a solution for the long term. The most important thing is how we can strengthen local import production so that it can meet our needs," concluded Puan.