The Rice Problem Is Still Unresolved

JAKARTA, KOMPAS — The issue of national rice supply remains unresolved. This problem is not only about pricing but also about trade regulations. If not addressed promptly, the rice supply issue will become increasingly challenging when the rice shortage arrives and poses a hindrance next year.

Based on data from the Food Price Panel of the National Food Agency (Bapanas), from January 2025 to September 21, 2025, the highest national average prices for medium and premium rice at the consumer level occurred in August 2025. At that time, the national average price for medium rice reached Rp 14,356 per kilogram (kg) and premium rice Rp 16,196 per kg.

As of September 21, 2025, the national average price of medium rice at the consumer level has decreased by 3.6 percent to Rp 13,837 per kg. Similarly, the national average price of premium rice has fallen by 1.45 percent to Rp 15,960 per kg.

However, the national average price of medium and premium rice is still above the national average of the highest retail price (HET). Bapanas has set the national average HET for medium rice at Rp 13,500 per kg and for premium rice at Rp 14,900 per kg.

During the first planting season of rice, rice and paddy production typically declines. In addition, the price of paddy at the farmer level will increase, which will subsequently drive up the price of rice again.

Practitioner and rice observer, Hery Sugihartono, on Sunday (21/9/2025), stated that rice prices have indeed started to decline slightly. This is thanks to the bountiful harvest of the second rice season in several regions in September 2025 and the distribution of rice for the Stabilization of Supply and Food Prices (SPHP).

However, the government must not be complacent as the lean season or decline in rice production is approaching. This is considering that the first planting season (MT) of rice in most rice-producing regions is expected to vary from October 2025 to February 2026.

"During that period, rice and paddy production usually declines. In addition, the price of unhusked rice at the farmer level will increase, which will subsequently drive up the price of rice again. This has become an annual pattern," he stated when contacted from Jakarta.

Jumair, a member of the West Java Rice Millers and Rice Entrepreneurs Association (Perpadi), also expressed similar concerns. He even predicted that competition for farmers' harvested rice would occur and that the production of premium rice remains limited.

According to him, rice mills and rice producers require unhusked rice to produce rice in order to meet customer demands at the end and beginning of the year. The limited availability of unhusked rice after the off-season harvest will prompt them to absorb unhusked rice.

"Large capital rice mills will certainly be bold enough to purchase farmers' unhusked rice at high prices. Meanwhile, small and medium rice mills will surely be at a disadvantage in competition," said Jumair.

In addition, Jumair continued, there are several homework tasks for the government regarding rice trade regulations. First, there is still no clarity on the policy of eliminating the classification of medium and premium rice into regular and special rice, as well as the determination of the HET for regular and special rice.

Secondly, the government has increased the HET for medium rice, but this has not been accompanied by an increase in the HET for premium rice. This has led rice mills and rice producers to be more inclined to produce medium rice rather than premium rice.

"We need certainty in our business endeavors. As long as the policies remain unclear, the rice milling business will undoubtedly be hindered. If the business is obstructed, in the end, we are the ones who will be pressured," said Jumair.

Kompas noted that the national rice trade system's problems this year were triggered by several government policies. This began with the policy of purchasing grain of any quality (with a standard quality mark and fraction) at a minimum of Rp 6,500 per kg for dry harvested grain at the farmer level.

This policy has resulted in an increase in the production costs of medium and premium rice, leading to a surge in the illegal mixing of rice that violates regulations. Subsequently, other policies emerged, such as the enforcement against the illegal mixing of rice and the monitoring of potential rice hoarding.

Due to observing that the price of GKP in Central Java is higher, intermediary traders are selling GKP to Central Java at elevated prices as well.

In addition, there is also a discourse on the elimination of the classification of medium and premium rice into regular and special rice. This will be accompanied by the establishment of the HET for regular and special rice. The discourse has not yet been fully addressed, and the government has already increased the HET for medium rice without a corresponding increase in the HET for premium rice.

The uncertainty surrounding the new rice policy could potentially cause rice producers to reduce or even eliminate premium rice production. While continuing to produce medium-grade rice, they could potentially shift premium rice production to fortified rice (Kompas, 11/9/2025).

This is what causes premium rice to be difficult to obtain, especially in modern retail networks. What is widely available instead is fortified rice, which is classified as special rice and is priced higher than premium rice.

This situation has prompted the government, through Perum Bulog, to supply modern retail stores with SPHP rice. The target for the distribution of SPHP rice in the modern retail network is 800,000 tons by the end of 2025.

Last week, the Head of the Research and Development Department of PT Food Station Tjipinang Jaya, Yanee Lasahido, stated that medium rice is more dominant in the market compared to premium rice. This is related to the conditions of rice mills and rice producers who can no longer produce premium rice due to high production costs.

On the other hand, the supply chain for rice, particularly between islands, remains lengthy. This can cause the price of rice from one region to rise when compared to another, thereby affecting the increase in rice prices.

He exemplified that in the past week, the price of GKP in several regions in Central Java ranged from Rp 7,400 to Rp 7,500 per kg. Meanwhile, the price of GKP in Lampung was around Rp 6,500 to Rp 7,000 per kg. However, due to the higher prices of GKP in Central Java, intermediary traders sold GKP to Central Java at elevated prices as well.

"This is what keeps rice prices high. The ones who benefit the most are actually the intermediary traders," he said during the webinar "Improving Food, from Mixing Practices to Optimizing Non-Rice Consumption" organized by the Agricultural Journalists Forum in Jakarta.

Meanwhile, Bapanas has reminded all food stakeholders to be vigilant regarding the dynamics of rice availability and prices approaching the end of 2025 and the beginning of 2026. During this period, Bapanas and Bulog are committed to managing the government's rice reserves (CBP) effectively.

The Head of Bapanas, Arief Prasetyo Adi, stated that rice production from January to September 2025 is estimated to reach 28.22 million tons. This production volume represents an increase of 3.18 million tons or 12.7 percent compared to the same period in 2024.

With national rice consumption from January to September 2025 reaching 23.21 million tons, the national rice production and consumption balance shows a surplus of 5.01 million tons. This surplus has increased by 3.13 million tons compared to the same period in 2024.

"This is certainly a positive achievement that we must be grateful for. However, we must not be complacent, as historically, rice production typically declines from November 2025 to January 2026. Meanwhile, the average monthly consumption reaches 2.5 million tons. It is at this point that we must be careful to maintain the availability and stability of rice prices in the market," he said.

Therefore, Arief continued, Bapanas and Bulog remain committed to managing the CBP to maintain the stability of rice supply and prices. The CBP—amounting to 3.8 million tons as of September 18, 2025—will be used to continue rice assistance for 18.3 million low-income families and the distribution of SPHP rice.

Bapanas also hopes that the relevant ministries/agencies, local governments, Bulog, and rice business actors will enhance coordination. The key is to closely monitor rice supply and price data and ensure the smooth distribution of rice.

"And if necessary, market intervention in rice or the absorption of farmers' paddy can be carried out. This way, the balance between the interests of producers and consumers can be maintained," he stated.

By the end of this year, the government will distribute 1.5 million tons of SPHP rice to lower rice prices. Of this amount, 800,000 tons will be channeled through modern retail networks.

In addition, the government will continue the distribution of rice for 18.3 million low-income families in October-November 2025. Previously, the distribution of rice assistance had been initiated in June-July 2025.

Regarding the removal of the classification of medium and premium rice, Arief stated that Bapanas has indeed been assigned to reformulate the quality classes of rice and the upper price limit for rice. In the future, the quality and price of rice will fall between medium and premium rice.

In addition, the price of rice in production center areas in central and eastern Indonesia will be differentiated. Currently, this policy plan is being refined in collaboration with other stakeholders.

"Once the policy is finalized and established, we will provide a transition period for its implementation," he said.