Indonesia to boost rice import quota on outlook for lower crop

Indonesia plans to increase its rice import quota this year by 80% to boost local supplies because domestic production in the first quarter is likely to be lower than last year on lack of rain.

The government intends to raise the quota by 1.6 million tons, said Arif Sulistiyo, import director at the trade ministry. That’s on top of two million tons of permits already issued to the state-owned food logistics company Bulog, he said Monday, speaking at a meeting at the home affairs ministry.

More purchases are likely to tighten global supplies of the food staple. Prices of Thai white rice 5% broken, a regional benchmark, soared to the highest level in 15 years in January as India, the biggest exporter, curbed shipments to cool local food inflation. India is not expected to ease curbs until after federal elections in April and May. 

The additional quotas have not been issued yet as the government is in the process of revising its food commodity balance sheet, a necessary step before the import permits are granted.

Indonesia imported the most rice in more than two decades last year as El Nino cut production and sent domestic prices surging. The rice harvest this year is expected to peak in March and April, but there is concern that unhusked output may drop by about 2.8 million tons in the first quarter from a year earlier. The government’s full-year target for unhusked output is 55.4 million tons.