JAKARTA: Indonesia has reached a tentative agreement to import 500,000 tonnes of rice from Thailand, an official at the state food procurement agency said on Wednesday. Indonesia, which lowered its domestic rice output forecast this week in the face of dry weather caused by an El Nino weather pattern, already has a separate contingency plan in place to import rice from Vietnam if needed.
“We agree on the volume – about 500,000 tonnes – but haven’t yet agreed on price, specification, and the shipment schedule,” Bulog Procurement Director, Wahyu told Reuters.
“We’ll continue talking about this and hope a contract can be signed soon,” said Wahyu, adding that if no substantial rain falls in Indonesia in the coming weeks, rice imports would need to happen as soon as possible.
Indonesia also has an agreement with Vietnam to import up to 1.5 million tonnes of rice if needed. Wahyu said a shipment from Vietnam was being prepared, but declined to give further details. Crop failures caused by an El Nino presage more pain for Southeast Asia’s largest economy – already growing at its slowest pace in six years – by squeezing incomes, fanning inflation and pushing more people into poverty.
Rice imports are a contentious issue in the country where President Joko Widodo is faced with fast-rising food prices but is also pursuing self-sufficiency in various foods to protect farmers.
Since coming to power a year ago, Widodo has aggressively pursued self-sufficiency in some foods, curbing state imports of rice in a country where private buying from overseas has been largely banned for decades.
Bulog is the dominant rice buyer in Indonesia, tasked with maintaining annual stocks of 1.5-2 million tonnes. Analysts have forecast that Indonesia will import 1.6 million tonnes of the staple grain this year.
