"The program which is launched in cooperation with Bank BRI and the Trade Ministry is intended to stabilize garlic prices because with the program stock would meet the need all the time," RNI President Director Ismet Hasan Putro, said in a discussion on how to overcome beef and onions crises here on Wednesday.
He said that the warehouse receipt system was aimed to purchase farmers` production and kept it as stock in the warehouses in the production centers.
"This is our concrete response and step in overcoming garlic price hikes which bring shame to the government," Ismet said.
Ismet said he was sad to see the increasing price of garlic which was skyrocketing from Rp20,000 per kg to about Rp90,000 per kg.
"We cannot let this condition to go on. We have to find a breakthrough not only for a short term but for a long run," the RNI president director said.
He said that garlic business was something new to RNI, but based on its experience in handling other commodities and on its good infrastructure networks, RNI believed that the warehouse receipt system would be successful.
"BRI assists us in term of funding. We have warehouses in 48 regions throughout the country. This condition will enable RNI to have the competence in handling garlic supply problems," he said.
He said RNI assured that the warehouse receipt system would benefit farmers and would ensure the availability of garlic stocks which so far had become the target of garlic business mafia.
In an effort to realize the program, RNI will in the first stage develop garlic plantations in two location in Lombok and Central Sulawesi.
In North Lombok, RNI is developing garlic and shallot plantations on a 5,000 hectare of land while in Central Sulawesi, the company is developing 5,000 hectares for plasm farmers and 5,000-10,000 hectares for nucleus farmers.
The garlic price in Jakarta`s Kramat Jati wholesale market was recorded at Rp19,306 per kg in January. It rose to Rp25,964 per kg in February and up to March 7, it has reached Rp32,000 per kg.
Garlic was the main contributor to the February inflation with average price increase of 30.25 percent in 64 cities grouped in the consumer price index (IHK). The highest price increase took place in Bandung, West Java, reaching 60 percent and followed by Serang, Banten (56 percent).
Last week, the prices of garlic in various parts of the country have reached a range between Rp45,000 per kg and Rp85,000 per kg.
Chief Economic Minister Hatta Rajasa earler asked the ministry of agriculture and the ministry of trade to improve a number of regulations on horticultural products, including onions in an effort to stabilize price fluctuations.
"I appeal to the agriculture and trade ministers to meet as soon as possible so that they could improve the agriculture and trade ministers` regulations, particularly with regard to garlic so that supply would meet demand," he said.
However, he said that the government would not be careless in importing garlic and shallots that could disadvantage local farmers.
"In case of shallots, our farmers have planted the commodity so that we should take supply and demand into consideration to avoid over supply that would harm their interests," the coordinating minister for economic affairs said here on Saturday.
He said that additional imports of garlic and shallots which were now running short of supply in the market were needed but it should be done with a very restrictive condition.