Question: How is the government anticipating volatility in food supplies and prices?
Answer: Such volatility has been experienced by all countries, not only Indonesia. A report from the World Bank in 2008 said that the world has not paid attention to food investment. In 2000, every country thought that the food problem was over. However, extreme climate conditions in 2007 and 2008 caused a decline in food stockpiles around the world. Since then, food supply has become an issue.
Our main strategy is to reduce connections with international traders as [international] trading is volatile and unpredictable. We must become a food self-sufficient country.
There are two important keys to attaining the goal. The first is to find proper technology. This is the biggest challenge for us because we can only allocate a small budget for research and there is no incentive for the private sector. Second, we have to invest more in this sector. We must improve our transportation infrastructure, irrigation, electricity, and so on.
We are also prone to higher inflation from food prices because of food accounts for more than 70 percent of people’s expenditures.
Why is agricultural investment sluggish when compared to other sectors?
The government has been the lead investor in the agriculture sector since 1970. Around 90 percent of total agriculture investment in Indonesia comes from us.
Investment from the private sector has not expanded because the government limits its role to protect the farmers. But starting in 2010, private companies have been able to invest in on-farm agriculture. Foreign investment in the sector is also encouraging, but they cannot hold a majority share.
Why does the price of rice continue to increase while farmers remain poor?
This is because farmers also buy rice. Up to 80 percent of farmers are net consumers, meaning their harvests are not sufficient for themselves because they own small plots. Farmers harvest their rice three times a year. After that they must buy rice. They have to sell their paddy immediately because they don’t have warehouses.
Why is food sufficiency always focused on rice and not other commodities?
Food diversification depends on income and education. This will in turn change our eating behavior. Civilization changes people. Around 300 years ago, people were still eating yams. Now they are eating grains and perhaps later they will consume flour. People in the developed world tend to consume flour because it is easy to make flour into kinds of other food. Unfortunately, Indonesians have diversified their main staple food from rice to wheat flour, which we have to import. Now we are trying to create flour from cassava. We expect it to be produced in a similar form to rice that can be cooked just like rice. Indonesians will be able to eat rice but not from a paddy.
Why is it difficult to change people’s love of rice?
Rice is still a cultural commodity for most Indonesians. If not addressed properly, insufficient rice supplies will be a political problem. Initially, our diversification effort is aimed at changing habits on consuming rice and offering more alternatives. But we are going against a culture. It is just impossible to change rice-eating habits overnight. Stopping people from eating rice will have a serious impact.