What is the Producer Price of Rice at the Mill?

Based on data from the Central Bureau of Statistics (BPS), the average producer price of rice at mills in November 2017 for medium-quality rice was Rp 9,280 per kilogram (kg), a 1.79 percent increase from the previous month. Medium-grain rice prices also increased by 2.54 percent year-on-year (YoY) compared to the same month of the previous year.

Similarly, for premium-quality rice in November 2017, prices rose by 0.38 percent to Rp 9,539 per kg from the previous month and also increased by 3.05 percent YoY compared to November 2016. Low-quality rice prices increased by 2.32 percent to Rp 9,039 per kg from the previous month and also rose by 4.72 percent (YoY). Low-quality rice prices recorded the largest increase, both monthly and yearly (YoY).

(Read Databoks: Starting September 1st, the Government Implements a New Highest Retail Price for Rice)

To prevent rice price fluctuations in the market, the government implemented a Highest Retail Price (HET) policy based on region. For medium-grain rice in Java and Lampung, the price is set at Rp 9,450 per kg, while the price at the mill has reached Rp 9,280 per kg. Rice traders at the Cipinang Rice Market complained that the production cost of medium-grain rice is insufficient to cover the HET of Rp 9,450 per kg. This has led traders to sell more premium-quality rice than medium-quality rice.