Called an Agrarian Nation, Indonesia’s Rice Production Declines by 440,000 Tons. What’s Going On?

Rice, One of the Poverty Contributing Commodities in Indonesia

Indonesia, often hailed as an agrarian nation, is facing a paradoxical situation with a significant drop in rice production. Despite its reputation, Indonesia’s rice production has decreased by 440,000 tons. What’s causing this unexpected decline?

The Ministry of Agriculture (Kementan) has shed light on the factors behind this decrease in 2023. Secretary General Prihasto Setyanto attributes the decline primarily to issues surrounding subsidized fertilizers.

One of the critical issues is the limited supply of subsidized fertilizers. Furthermore, accessibility to these fertilizers has been problematic. Prihasto revealed that approximately 17-20% of farmers could not use the Farmer’s Card to obtain subsidized fertilizers. Additionally, about 30 million farmers in forest village areas did not receive any subsidized fertilizers.

According to data from the Central Statistics Agency (BPS), rice production in 2023 was recorded at 31.1 million tons, a significant drop from the 31.54 million tons produced in 2022.

“The decline in rice production in 2023 by 0.44 million tons is partly due to the availability and accessibility of subsidized fertilizers,” Prihasto stated during a hearing with Commission IV of the House of Representatives (DPR-RI) at the Parliament Complex on Wednesday (June 19, 2024).

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To tackle these challenges, Kementan has undertaken several initiatives. One major step has been the approval of increased subsidized fertilizer allocations, from 4.73 million tons in 2023 to 9.55 million tons in 2024, benefiting 14.2 million farmers.

Prihasto also highlighted the revision of Ministerial Regulation 10/2022 to Ministerial Regulation No.1/2024, which aims to improve fertilizer management. The new regulation now includes organic fertilizers among the subsidized types, along with Urea, NPK, and special NPK.

Revised Regulations and Improved Management

Under the updated rules, farmers must join a farmer group (poktan) and be registered in the e-RDKK, sourced from the Agricultural Extension Management Information System (Simluhtan). The funding for subsidized fertilizers is now evaluated every four months, as opposed to once a year previously. This change ensures a more responsive and adaptive distribution of resources.

The allocation of subsidized fertilizers is now detailed by type, amount, and distribution area. The e-RDKK allocation and area-based allocation consider the total rice field area and LP2B. Eligible commodities for subsidized fertilizers include rice, corn, soybeans, chili, shallots, garlic, sugarcane, cocoa, and coffee.

“Subsidized fertilizers can now be obtained using a KTP or Farmer’s Card,” Prihasto added.

In addition to fertilizer issues, the decline in rice production is also linked to several other factors. Reduced budget expenditures, fewer high-quality seeds, and aging agricultural machinery have all played a role. The impact of El NiƱo-induced droughts, the need to rehabilitate 60% of irrigation channels, and an insufficient number of agricultural extension workers (PPL), with only 50% of the required number, have further exacerbated the situation.

In conclusion, Indonesia’s rice production decline highlights the multifaceted challenges facing the nation’s agriculture sector. Addressing these issues through increased subsidies, improved regulations, and better management practices is crucial for stabilizing and boosting rice production in the coming years.