Agriculture Minister Andi Amran Sulaiman revealed on Monday that the method involves combining 80 percent subsidized rice with 20 percent premium rice, then selling the mixture at higher market prices without proper oversight.
He explained that rice subsidized under the Stabilization of Food Supply and Prices (SPHP) program is intended to ensure affordability, with subsidies reducing the price by Rp1,500 to Rp2,000 per kilogram. However, much of this rice fails to reach its intended recipients.
Sulaiman estimated that around 1 million tons of subsidized rice are being mixed and sold improperly, allowing perpetrators to profit from the price gap — resulting in potential state losses of Rp2 trillion each year.
“They display rice that’s only 20 percent premium, mixed with 80 percent subsidized stock. This causes losses of Rp2 trillion annually,” he said.
He also noted that the problem is worsened when SPHP rice is distributed during harvest season, which depresses prices for farmers and disrupts the rice market by allowing third parties to exploit the supply chain.
Sulaiman said the Food Task Force has conducted field investigations and is urging tighter supervision to prevent recurrence.
According to him, SPHP rice is often dismantled from its original packaging, repackaged, and sold as medium or premium rice —violating distribution standards.
The government is calling on all rice distributors to follow regulations for subsidized rice. Legal sanctions will be imposed on violators, Sulaiman warned.
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Translator: Muhammad Harianto, Resinta Sulistiyandari
Editor: Anton Santoso
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