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Wednesday, March 4, 2009

News Focus: Indonesia to export super quality rice in March

By Eliswan Azly

Jakarta (ANTARA News) - Having succeeded to record a surplus of over 2.7 million tons of rice in mid 2008, Indonesia will start to export super quality rice to some Asian countries such as Japan, Malaysia, Brunei Darussalam, Hongkong and Timor Leste.

Mustafa Abubakar, the Director of the National Logistic Agency, here on Wednesday said at the begininig, Indonesia will start exporting super rice to Japan, the volume of which was about 100,000 tons per year in March or April.

"However the export of rice to Japan will be conducted everymonth. As the first step, we concentrate more on exporting super quality rice and then the medium rice will follow the suit if the national target to produce 40 million tons of hulled rice or 63 million tons of unhulled rice can be achieved in 2009," he said.

If the national target to produce 40 million ton of rice in 2009 can really be achieved, there will be a surplus of rice between 3 to 4 million tons. "If allowed, we can export super and medium rice at least 3 million tons to Asian countries like Malaysia, Brunei Darussalam, East Timor for medium rice," he said.

The rice can be categorized into super quality rice, if the percentage of the broken is only within a range of ziro to five. . It can be either Cianjur, Pandan Wangi, Padi Mulia or aromatic rice. In the meantime, the broken of medium rice is between five to ten percent.

In Indonesia, rice plays a crusial role, as 97 percent of the whole population in this world largest archipelagic country consumed rice, it could be seen from the ratio of rice consumed by an individual in this world largest archipelagic country.

An Indonesian consumes 139 kilo of rice per year, while a Malaysian only consumes 83 kilos per year and 50 kilos per year for a Japanese.

The price of super quality rice is about USD1 to USD2 per kilo or around US$400 per metric ton. If the export could reach a level of one million tons in this year, practically Indonesia will earn about USD400 million from the export of rice, Abubakar said.

"On January 7, we signed an agreement with two importers and a local company in East Java to arrange the issuance of a permit from the Trade Ministry for the rice exports," he said.

In addition to Japan, according to Mustafa, some other ASEAN countries had also requested for the Indonesian rice, but of medium quality in 2009. "They are the Philippines, Malaysia, Timor Leste, and Brunei Darussalam, but we are still waiting for adequate rice supply to meet local consumption which can be calculated from June to September 2009."

"The four countries have tendered their formal and informal orders through their respective consuls in Jakarta for the import of the Indonesian," he said, adding Indonesia planned to export one to 1.5 million tons of rice of medium quuality.

However, Mustafa admitted that he was not in a position to decide on the rice export plan. He could only make a proposal, because the relevant authorities have left the matter to the Trade Ministry on the condition that Indonesia reached a rice overproduction of three million tons.

According to him, if the production of unhusked rice in 2009 reaches the projected 63 million tons, it is predicted that there will be a big overproduction, paving the way for rice exports to the Philippines, Malaysia, Timor Leste and Brunei Darussalam.

In the meantime, the Central Bureau of Statistics (BPS) last year projected Indonesia`s dry unhusked rice production at 59.88 million tons, up by 2.72 million tons due to an expansion of the land of the harvest by 237,610 hectares and an increase in productivity of the rice fields by 130 kg/hectare.

In 2007, Indonesia`s dry unhusked rice output rose by 4.98 percent or 2.70 million tons from 2006, enabling the country to enjoy a surplus of 1.5 million tons, while the country could only enjoy a surplus of about 50,000 tons. But in 2009 the surplus is expected to reach over three million tons.

Earlier, Director General of Food Crops Sutarto Alimoeso expressed optimism over Indonesia`s ability to record a surplus of over 2.7 million tons in 2009 following a BPS prediction of an increase in the country`s rice output in 2009.

Sutarto said he would ask the National Land Agency (BPN) to allow the rice growers to use idle land. "We have millions of hectares of idle land. However, our farmers cannot make use of them," he said.

Although Indonesia has become self-sufficient in rice and had a rice overproduction in 2008, the country is still considering rice exports on a regular basis.

Agriculture Minister Anton Apriyantono said last year Indonesia had no intention to export the commodity in large quantities, although many countries had asked Indonesia for the staple.

But, the minister said the government would not impose a ban on rice exports, but merely put a limit to volume and type of the rice for export.

The rice surplus will be handed over to the National Logistics Agency for storage.

The ministry had issued a regulation that only Bulog is authorized to export rice. The board can also import the staple if its stock has started declining from 1 million tons.
It said exporters are only allowed to export sticky rice after obtaining an approval from the foreign trade director general at the trade ministry.

The ministry said the regulation was needed to stabilize rice prices in the domestic market and protect the interest of the public, as rice is a staple food in Indonesia, with a population of over 230 million.

Meanwhile, Trade Minister Mari Elka Pangestu said the government was drafting a regulation on the export of a number of foodstuffs which are in a surplus, including rice. Under the regulation, rice of a certain quality could be exported while the government is committed to securing stocks and stabilizing prices in the domestic market.

"The government is committed to keeping the price of the staple at Rp4,750 to Rp6,000 per kg so that it will not burden the people," Pangestu said.

"The price of rice in the world market is relatively high but as long as the domestic price is maintained at a stable level and stock is adequate, the situation will remain secure," Mari added.

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