Prabowo's Instructions and Massive Market Operation "Ammunition"

The government will conduct large-scale market operations to anticipate a surge in food prices during Ramadan-Eid 2025. Several types of staple foods amounting to 189,000 tons and 70,000 kiloliters of Minyakita have been prepared as "ammunition" to flood the market.

Perum Bulog, ID Food, PT Perkebunan Nusantara (Persero) or PTPN, and PT Pos Indonesia (Persero) were mobilized. Even several retail and food entrepreneurs, as well as 453 food stalls in 102 regencies/cities across 31 provinces, were involved. What exactly is happening?

On February 17, 2025, the government decided to conduct a large-scale market operation across Indonesia. The market operation, in the form of the Affordable Food Movement, will take place daily from February 24, 2025, until the end of March 2025.

The targeted food commodities include rice, cooking oil, garlic, meat, and sugar. The National Food Agency (Bapanas) was appointed as the "conductor" to "orchestrate" the market operation.

Minister of Agriculture Andi Amran Sulaiman, Wednesday (2/19/2024), said that the market operation was an order from President Prabowo Subianto. The President wants the public to be able to buy food at affordable prices during Ramadan-Eid 2025.

The President even urged staple food business operators to sell their commodities in accordance with the highest retail price (HET) and the reference sales price (HAP) at the consumer level as determined by the government. Business operators who violate these pricing regulations will be dealt with by the Food Task Force of the Indonesian National Police.

"The sanctions are in the form of sealing, even revocation of business licenses," he said after the Limited Coordination Meeting on Stabilization of Food Stocks and Prices during Ramadhan-Lebaran 2025 at the Ministry of Agriculture, Jakarta.

Business actors who violate price regulations will be prosecuted by the Food Task Force. The sanctions include sealing, even revocation of business licenses.

Bapanas Chief Arief Prasetyo Adi, Thursday (20/2/2025), said that Bapanas has prepared "ammunition" for massive market operations. MinyaKita has been prepared as much as 70,000 kiloliters. Of that amount, Bulog will handle 50,000 kiloliters and ID Food 20,000 kiloliters.

Consumption sugar will be distributed as much as 50,000 tons. Of that amount, PTPN will distribute 43,000 tons and ID Food 7,000 tons.

For frozen buffalo meat, Arief continued, 19,000 tons have been prepared, consisting of 10,000 tons belonging to PT Berdikari and 9,000 tons belonging to PT Perusahaan Perdagangan Indonesia. For rice, Bulog will distribute 100,000 tons.

"Meanwhile, for garlic, the government is targeting to distribute 20,000 tons through 21 business actors," he said.

According to Arief, market operations were carried out massively to reduce food inflation during Ramadhan-Eid 2025. In each period, the trend of food inflation always increases.

In Ramadhan-Lebaran 2023 which took place in March and April, the annual food inflation rate was 5.83 percent and 3.74 percent respectively. Then in Ramadhan-Lebaran 2024 which also took place in March and April, the food inflation rate was 10.33 percent and 9.63 percent respectively.

"This year, food inflation opened quite well, namely 3.07 percent in January. In Ramadhan-Lebaran 2025, we are trying to maintain it so that it remains within the corridor of the inflation target for volatile food price components set by the government in the range of 3-5 percent," he said.

Along with the volatility of food inflation, the government is also trying to maintain people's purchasing power. This purchasing power is reflected in one of the components of economic growth, namely household consumption.

Throughout 2024, household consumption has consistently grown below 5 percent, or below its potential. In fact, household consumption is the largest contributor to gross domestic product (GDP), namely 54.04 percent.

The Central Statistics Agency recorded that in the fourth quarter of 2024, household consumption grew by 4.98 percent. This continues the trend of growth below 5 percent in the first quarter (4.91 percent), the second quarter (4.93 percent), and the third quarter (4.91 percent).

Nevertheless, on an annual basis, household consumption growth in 2024 is slightly better than in 2023. In 2024, household consumption grew by 4.94 percent, whereas in 2023, the growth was 4.82 percent.

This reflects that people's purchasing power has not fully recovered. Many people, including the middle class, are starting to sort out their spending to align their shrinking income with their spending.

In addition, the government also specifically wants to lower the prices of at least two staple food commodities down to near the government's benchmark price. The two commodities are garlic and Minyakita, a simple packaged cooking oil for the people.

For months, the prices of both commodities have been perched above the government's benchmark prices. For months, the two commodities have often been the main menu in regional inflation control coordination meetings held by the Ministry of Home Affairs every week.

Since early June 2024 to February 20, 2025, the price of Minyakita has moved up and tends to be stable high above the HET of IDR 15,700 per liter. Based on data from the Ministry of Trade's (Kemendag) Market and Basic Needs Monitoring System, as of February 20, 2025, the national average price was IDR 17,200 per liter. Over the past nine months, the price increase of Minyakita has reached 6.17 percent.

The national average price of Honan garlic is IDR 43,900 per kg or still above the HAP at the consumer level of IDR 40,000 per kg. The price of garlic imported from China has started to climb since September 2024. Over the past six months, the price increase has been 6.04 percent.

Expert Staff of the Minister of Trade for Market Climate and Market Security Tommy Andana explained that Minyakita's monthly stock is always sufficient. The average stock is often above the national need for Minyakita and bulk cooking oil which is 170,000 tons per month.

The increase in Minyakita prices was caused by many retailers buying Minyakita from other retailers, so the distribution chain is getting longer. In addition, there are also naughty second-line distributors (D2) who sell Minyakita to retailers above the benchmark price.

Meanwhile, regarding garlic, Deputy III for Economic Affairs of the Presidential Staff Office (KSP), Edy Priyono, said that price increases are often triggered by delays in realizing imports. In a number of meetings held by KSP and the Ministry of Trade, garlic importers admitted that they did not immediately realize imports because the price of garlic in China is expensive.

Bapanas is trying to solve both problems. Cooking oil producers are asked to distribute Minyakita through Bulog and ID Food networks. Garlic business actors are also asked to provide 20,000 tons of garlic for market operations.

The President has given instructions. Various "ammunition" has been prepared. The market is ready to be flooded with a number of affordable staple foods. Rogue business actors will also be dealt with firmly.