PRICES SHOWING UPWARD TREND IN FACE OF FASTING MONTH

By Andi Abdussalam

Jakarta, Aug 21 (ANTARA) - The prices of basic consumer goods such as sugar and cooking oil have begun to show an upward trend in the face of the fasting month of Ramadan which starts on Saturday, August 22, 2009.

        Though sugar and cooking oil stocks are available in large volumes, yet their prices have continued to increase. "We do not deny that commodity prices are now increasing due to psychological factors in the face of high demand and the fasting month," Jimmy Bella of the Trade Ministry said.

        Based on the trade ministry's monitoring of commodity prices and goods distribution this week, the average national price of sugar increased Rp99 per kg to Rp8,802 if compared with the average price of the commodity at Rp8,703 per kg in the past two weeks.

        The August average price of sugar increased Rp229 from Rp8,468 per kg in July to Rp8,697 per kg this August. The highest price was recorded in Manokwari, Papua, at Rp11,000 per kg and the lowest one at Rp8,000 per kg in Denpasar, Bali.

        Jimmy said that the high price was boosted by the increase in sugar consumption by cottage food and drink industries. In the meantime, importation of rough and refined sugar is also being tightened by the government while in the world market sugar price is also on the rise.

        "If we look at the national need estimate and projection of sugar production at 2.8 million tons in 2009, we are sure stocks are still enough. We have also taken into account the need during the fasting month and the post-fasting lebaran festivities," Jimmy said.

        He admitted that the Rp8,800 sugar price per kg was too high but that could happen because the auction sugar price followed that of the international one which reached about 500 to 550 US dollars per ton.

        "As the auction price has reached Rp7,300 per kg, it would be understandable if at the consumers level the sugar price reached Rp8,000 per kg," he said.

        In the meantime, the average national price of cooking oil has also experienced an increase by Rp184 per kg as compared with the average national price of the commodity two weeks ago which stood at Rp9,276 per kg.

        The highest price took place in Manokwari at Rp14,300 per kg and the lowest one at Rp7,700 per kg in Banjarmasin, South Kalimantan.

        The increase in cooking oil price was generated by crude palm oil (CPO) in the world market which remained steady at 700 US dollars per ton. In order to offset cooking oil price increase, the trade ministry asked producers to carry out Corporate Social Responsibility (CSR) by selling the so called 'Minyakita' cooking oil package at Rp7,500 per liter.

        "In other months, the price of cooking oil could possibly be adjusted but because this time we are facing the fasting month and the lebaran festivities, the price of cooking oil will seemingly remain at Rp7,000 per kg," Jimmy said referring to the 'Minyakita' cooking oil package. Minyakita is cooking oil with a trade mark of and belongs to the Trade Ministry which is sold at a low price.

        On a separate occasion, Max Ramajaya of PT Wilmar Internasional, said his firm would organize cooking oil bazaars for a volume of 200,000 kg of cooking oil during the fasting month. "We remain committed to holding bazaars for the Minyakita oil but during the fasting month we will use our own trade mark 'Fortune' so that consumers would be able to recognize our products," Max Ramajaya said.

        Besides, cooking oil and sugar, the prices of other commodities such as rice, meat, chicken, eggs and onions have also shown an upward trend in various parts of the country.

        In Bandung, West Java, for example, the prices of basic necessaries in several traditional markets are beginning to increase. "A sharp increase happens with garlic at Kiaracondong market. It increases from Rp5,500 per kg to Rp15,000 per kg," Nana Supriatna of the Bandung Trade Service said adding that at Kosambi traditional market the price of chicken meat had also increased from Rp35,000 - Rp42,000 to about Rp70,000 per kg. He said that the price increase at the trader level was due to the fact that suppliers also raised their price.

        Nana said that the price increases in Bandung happened with other commodities such as local beef which increases 1.28 percent, broiler chicken 3.33 percent, local chicken 27 percent, local chicken eggs 6.12 percent, cooking oil 5.8 percent, red onion 9.42 percent and garlic 20.88 percent.

        One day ahead of the fasting month, the price of rice in a number of traditional market in Pangkalpinang, Bangka Belitung province in Sumatra, was also moving up on Friday. A Kian, a trader at a traditional market said that supplies of rice from Java and Sumatra remained as usual while demand for the commodity was increasing so that price began to go up.

        The price of TR rice type increased to Rp89,000 per sack (15 kg) from Rp85,000 in the previous day, while that of the AAA type increased from Rp208,000 per sack (40 kg) to Rp210,000 per sack. The Gareng type increased from Rp223,000 per sack (40 kg) to 225,000 per sack.

        The same increase also took place with commodity prices in the traditional market in Gorontalo, Sulawesi. Trader Yasin Ngabito who sells chicken meat said that he had to raise the price of his chicken from Rp27,000 per piece to Rp35,000. "Prices here have been increasing in the past three days because supplies began to run short," he said.

        The sharp increase also occurred with garlic which rose from Rp7,000 to Rp16,000 per kg.

        "The increase in the garlic price is due to scarce stocks," said Yuwin Wahiti, a spice trader.

        In Surabaya, East Java, the price of chili increased Rp1,000 per kg to Rp10,000 per kg. "The price increase is boosted by increase in demand in face of the fasting month," trader Hermin Anggaraeni at Wonokromo traditional market said. The price of red chili also increased to Rp10,000 per kg, she added.

        Rini Setyo, a vegetable trader at Jagir Baru traditional market said that the prices of vegetables such as tomatoes, potatoes and carrots were also increasing.

        The increase in the commodity prices throughout the country are expected to boost inflation. However, there is no need to worry about inflation. "There is no need to worry about the inflation rate in the fasting month as long as traders and buyers are able to manage their behavior," Djamal of the Central Board of Statistics (BPS) said this week.

        However, he admitted that the increase in the gas price would have impact on inflation. "The impact of gas price now is relatively high. Possibly because of the fact that rice price is also on the rise," Djamal said. ***2*** (T.A014/A/HAJM/17:50/a014)

        (T.A014/A/A014/A/A014) 21-08-2009 18:11:04