Be careful, Indonesia has the potential to have another rice deficit in June 2024

The rice production-consumption balance in May 2024 has the potential to have a surplus of 0.62 million tonnes and in June 2024 a deficit of 0.45 million tonnes.

KOMPAS/AGUS SUSANTO

A buyer checks the quality of rice at the Cipinang Rice Main Market, East Jakarta, Thursday (25/4/2024).

JAKARTA, KOMPAS — The Central Statistics Agency predicts that the national balance of rice production and consumption in June 2024 will once again be in deficit, after having a surplus in March, April, and May 2024. The government needs to be vigilant and optimize the absorption of rice or grain to strengthen the government's rice reserves.

Even so, The National Food Agency (Bapanas) guarantees that rice stocks until the end of this year are safe, namely around 10.09 million tons. However, such a large stock can only be met if rice production and imports are according to estimates and planning.

This was raised during the Regional Inflation Control Coordination Meeting held by the Ministry of Home Affairs in a hybrid format in Jakarta on Monday (29/4/2024). The meeting, led by Minister of Home Affairs Muhammad Tito Karnavian, was attended by representatives of local governments and a number of food stakeholders.

Acting Central Statistics Agency (BPS) Amalia Adininggar Widyasanti said that the price of rice continues to fall along with the rice harvest in March-April 2024. As of the fourth week of April 2024, the national average price of various types rice IDR 15,667 per kilogram (kg) or a decrease of 2.41 percent compared to March 2024.

The decrease in rice prices is predicted to continue until May 2024 due to the surplus in the production and consumption balance of rice during that month. This continues the surplus of rice in March-April 2024.

”However, in June 2024, the balance has the potential to go into deficit because rice production is expected to fall. "The government needs to be alert and prepare a number of anticipatory steps because rice prices could rise again," he said.

Based on the results of BPS' Area Sample Framework, the balance between rice production and consumption in March-April 2024 is a surplus of 3.78 million tons. The surplus is supported by rice production during those two months, totaling 8.46 million tons.

In May 2024, rice production-consumption balance is estimated to still have a surplus of 0.62 million tons. Then, in June 2024, the rice deficit has the potential to occur again, namely 0.45 million tonnes.

This happens because the production of rice in the form of dried milled rice (GKG) after the harvest season is decreasing. GKG production is estimated to decrease from 5.54 million tons in May 2024 to 3.68 million tons in June 2024.

BPS also showed that in the first semester (January-June) of 2024, Indonesia experienced three rice surpluses, namely in March, April, and May. Meanwhile, in the second semester of 2023, there were five rice surpluses occurring in February, March, April, May, and June. The rice surplus throughout the first semester of 2024 decreased from 3.36 million tons to 1.03 million tons compared to the first semester of 2023.

The balance between rice production and consumption in May 2024 is predicted to still be in surplus by 0.62 million tons, while in June 2024, there will be a deficit of 0.45 million tons.

In response to this, Director of Plant Protection of the Directorate General of Food Crops of the Ministry of Agriculture (Kementan), Rachmat, stated that everyone needs to understand the trends in rice production in Indonesia. There are times when rice production experiences a surplus during the harvest season and a deficit during certain seasons.

"Therefore, the absorption of unhusked rice or rice to strengthen the government's rice reserves needs to be done during the harvest season. The reserves can be utilized during periods of rice production deficit," he said.

Rachmat added that the absorption of unhusked rice or rice could also be optimized for the May 2024 rice harvest. There are several areas that will have rice harvests with fairly vast planting areas, such as West Java with an area of 225,044 hectares, East Java with 140,860 hectares, Central Java with 133,971 hectares, Lampung with 99,309 hectares, and South Sumatra with 27,434 hectares.

Also read: Total Rice Production March-April 2024 Estimated to be 8.46 Million Tons

KOMPAS/AGUS SUSANTO

A paddy field ready for harvesting Inpari 32 rice in Sarimukti village, Cibitung district, Bekasi regency, West Java, on Friday (26/4/2024). The harvested dry grain of Inpari 32 variety is sold by farmers at IDR 4,000-IDR 5,000 per kilogram (kg), depending on its quality. This price is below the government's temporary purchase price for dry grain at IDR 6,000 per kg.

Strengthen CBP

In the meeting, Tito also emphasized the importance of strengthening the CBP through the absorption of rice in the domestic market. Such efforts are very much needed considering the potential deficit of rice in June 2024 caused by declining rice production.

Furthermore, during this current harvest season of rice, many large rice traders are buying large quantities of rice at higher prices. Perum Bulog is also quickly losing to them.

"This needs to be warned because the rice can be stored and sold at a higher price at any time. Therefore, Bulog needs to increase its absorption of rice or paddy to increase the CBP," said Tito.

Bulog targets to increase the absorption of grain or rice by 500,000 tonnes of rice equivalent by May 2024.

The Head of Operational Planning and Public Service Division of Bulog, Epi Sulandari, acknowledged that Bulog has already absorbed rice and paddy from within the country. This absorption is carried out through both farmer group associations and milling.

As of April 28, 2024, the realization of Bulog's absorption of domestic rice and paddy amounted to 217,323 tons of rice equivalent. Of that amount, 169,421 tons were for CBP and 47,000 tons were for commercial purposes.

"The absorption of unhusked rice and rice grains will continue until May 2024 considering there is still potential for paddy harvest during that month. We aim to increase the absorption of unhusked rice or rice grains by 500,000 tons equivalent to rice," said Epi.

With domestic absorption and rice imports, the total stock of Bulog's imported rice as of April 28, 2024 is 1.525 million tons. Of that amount, 1.508 million tons are CBP and 17.191 tons are commercial stock.

Also read: Rice Players Compete to Absorb Grain and Rice

KOMPAS/HENDRIYO WIDI

Screenshot of the Secretary of the National Food Agency (Bapanas) Sarwo Edhy presenting the National Food Balance Projection 2024 at the Regional Inflation Control Coordination Meeting held by the Ministry of Home Affairs in a hybrid format in Jakarta on Monday (29/4/2024).

Meanwhile, Bapanas Secretary Sarwo Edhy stated that Bapanas ensures that rice stocks will be sufficient until the end of 2024. Based on the updated National Food Balance Projection 2024 on April 23, 2024, the national rice stock at the end of this year is 10.09 million tons, or enough to fulfill the needs for 118 days.

"However, this stock can be realized if domestic rice production targets and rice import plans are met," he said.

Referring to the data from the National Food Balance Projection 2024, domestic rice production is estimated at 32 million tons this year. Rice imports from January to March 2024 have already reached 1.41 million tons. Meanwhile, the planned rice imports from April to December 2024 are targeted at 3.76 million tons.

Therefore, the amount of rice stock availability throughout 2024 reaches 41.31 million tons. With an annual consumption requirement of 31.21 million tons, Indonesia still has a rice stock at the end of the year of 10.09 million tons.

Also read: HET of Medium Rice and Increased HAP of Corn