Indonesia's state procurement agency Bulog plans to lift rice stocks up to four-fold from current levels and boost sugar, soybean and corn stocks to defend against food inflation due to rising commodities prices, a junior government minister said.
"The aim is to stabilise the prices both at consumer and producer levels," said Deputy Trade Minister Bayu Krisnamurthi. "Currently we have rice stocks of 500,000 tonnes, and we will increase them to 1.5-2.0 million tonnes." Bulog usually maintains rice stocks at between 1.5 million and 2 million tonnes by buying from domestic suppliers or exporters within the region, with a preference for the former.
Corn and soybeans would be imported by Bulog and registered importers only, Krisnamurthi said, similar to the import permit system used for rice and sugar.. He did not say how many importers would be registered, or whether they would be state or privately owned entities.
US corn and soybean futures have soared to record highs for the year in both August and September, after the worst drought in 56 years started pushing prices upwards about 2-1/2 months ago. In the face of rising commodities prices, the Indonesian government said last month that it would expand the role of Bulog in order to build bigger food stockpiles. Indonesia, Southeast Asia's largest economy, imported 1.9 million tonnes of rice last year, mostly from Thailand and Vietnam, and has ambitious plans to maintain stocks of about 10 million tonnes by 2014.