JAKARTA: Indonesia has allocated an additional rice import quota of 1.6 million metric tons for 2024, after shipping in near record volumes in last year, as dryness linked to the El Nino weather pattern delayed harvest at home.
The latest import quota, which is on top of 2 million tons previously approved for 2024, comes amid expectations the January-March harvest will be lower than last year due to below normal rains in Java – the country’s key rice growing region.
“Indonesian rice buying has been driving global prices higher and this news adds further bullish momentum to the market,” a Singapore-based rice trader said.
Asia rice prices have been near a 16-year high after India, the world’s top supplier, restricted exports last year.
Rates of parboiled rice exported from top hub India climbed to record highs this week on limited supplies and slight improvement in demand.
Prices in the key export hubs of Thailand and Vietnam are near their highest since 2008.
Lower Indonesian output threatens to further tighten supplies, pushing rice prices higher.
Indonesia’s January-March rice production is expected to be 2.82 million tons lower compared to the same month last year, Trade Ministry official Arif Sulistiyo said during a weekly government meeting streamed live.
The trade ministry is working to issue the import permits for the additional allocation, Arif added.
His presentation slide showed an unchanged target for annual output at 32 million tons, versus an estimated 30.9 million tons in 2023.
National Food Agency Chief Arief Prasetyo Adi, however, told reporters the government was focusing on executing the 2 million tons rice import quota earlier approved, while the additional quota would be executed later if needed.
Indonesia, Southeast Asia’s biggest economy, imported 3.06 million tons of the grain in 2023, close to a record.
At the retail level, rice is selling in Indonesia at prices above the government-set cap amid supply worries.
Source: CNA
