National food buffer stock agency Bulog is buying 300,000 tons of rice from Vietnam in order to maintain its stock.
Deddy Saleh, director general of foreign trade at the Trade Ministry, said that the agency will import rice from its Southeast Asian neighbor until December.
The agency is also tendering a 100,000 ton rice import from India because it is selling at a cheaper price than rice from Thailand.
Bulog usually maintains rice stocks at between 1.5 million and 2 million tons to provide a buffer against disaster. Last month, Bulog forecasted it would import between 500,000 to 770,000 tons of rice this year.
The country’s rice production is expected to reach 39 million tons this year, according to a calculation using Central Statistics Agency (BPS) data.
Despite this, local rice may not reach Bulog’s buffer. Bustanul Arifin, an agricultural economist at the Institute for Development of Economy and Finance, said a lack of infrastructure and “woeful storage management” makes it hard for the agency to procure from local farmers.
Indonesia agreed in August to import as much as 100,000 metric tons of rice annually from Cambodia. It was the latest of such agreements, as the government has already formed deals with Thailand for 1 million tons, Vietnam for 1.5 million tons and Myanmar for 200,000 tons.
Green Trade, a Cambodian state-owned company, will be in charge of the Cambodia exports, working with the country’s rice exporters union.
Media reported on Thursday that Bulog had signed deals with Green Trade and another Cambodian company, Chamalay Foods, for the rice import from Cambodia. But Deddy said they had only signed statements of competency and nothing was yet official. “The buying deals depend entirely on Bulog,” he said.
Mohamad Helmi, business development director at trading company Galuh Prabu Trijaya, said Green Trade has assigned three Cambodian companies — Agro Empire, Future Foods and Khy Thay Corporation — to export rice to Indonesia.