COMMODITY PRICES SHOWING UPWARD TREND

By Andi Abdussalam

Jakarta, July 18 (ANTARA) - Commodity prices in the country, particularly those of basic necessities, have begun to show a rising trend in the run-up to the fasting month of Ramadan that begins at the end of the week.          Economist of the Institute for Development of Economics and Finance (Indef) Enny Sri Hartati said that this increase was due to certain private businesses which manipulate prices in order to create a condition where the markets are non- competitive.          "There are certain parties who control and decide prices in accordance to their desires. That causes the markets to be non-competitive," said Enny on Tuesday.          Prices of various basic necessities in Jakarta, for example, have continued to increase in the past several days. Traders say prices have been increasing, since the past three weeks.          Anik, one of the traders at Gandaria Market in Central Jakarta, said that the price of chicken had been on the rise since the last three weeks. Almost all food prices are on the rise. A relatively big chicken is usually sold at Rp18,000 each. "Now its price has reached up to Rp35,000 each," Anik said.          There is a steep price increase even for meat. Meat trader Usin said that the beef prices had increased to Rp80,000 per kg from Rp70,000 per kg. "Demand for meat continues to increase even as our stocks continue to be limited,¿ he explained.       The same is true for other commodity prices. Chili was sold between Rp15,000 and Rp16,000 last week, but had increased to Rp20,000, before selling at Rp28,000 per kg on Tuesday.          Traders said that different types of onions like garlic and 'Bombay' onion had seen price increases from Rp12,000 to Rp18,000, and Rp8,000 per kg to Rp11,000 per kg respectively.          Meanwhile, the price of eggs rose from Rp16,000 per kg to rp20,000 per kg. In the meantime, rice price also increased, but ever so slightly. The price of best quality rice increased from Rp7,000 per kg to Rp10,000 per kg.          'Putri Sejati' rice also experienced a price increase of some Rp100 per kg daily. The price of a sack of rice weighing about 25 kg, has now reached Rp25 thousand, increasing by Rp2,500 per kg. It is now being sold at Rp8,200 per kg.         With reference to sugar, trader Ipan said that sugar price also was up from Rp12,000 per kg to Rp13,000 per kg.          Traders said that although prices were now on the rise, the number of consumers buying the commodities did not decline citing regular demand. Still, a number of consumers complained about the price increases.          According to a buyer Budhiarti, the prices of food items had shot up, particularly beef, chicken and chili. She said she used to spend anywhere between Rp50,000 and Rp80,000 when she visited the market to shop for her kitchen needs.         "Now, I have spent Rp100,000, without buying rice. Rice used to be sold at Rp170,000 for 20 kg, but now it sells at Rp195,000 per 20 kg," Budhiarti complained when we met her in a market at Jakarta.          Data at the Ministry of Trade and Industry on July 10, indicated that the national average price of beef was Rp75,332 per kg, of chicken rp27,081 per kg, of egg Rp18,301 per kg, of sugar Rp13,123 per kg and of red chili Rp28,387 per kg. The average increase in the prices of these goods when compared to those from last June is between Rp1000 and Rp3,000 per kg.          According to Indef economist Enny Sri Hartarti, demand during the season increases in the run up to the fasting month and during the post-fasting festivities, locally called "Lebran," and could be seen as being realistic, since consumers would continue to shell out money for basic necessities.         Therefore, Agriculture Minister Suswono urged business players to not make use of this opportunity to overtly raise prices. "We urged business players to alleviate the price burden of consumers by not overly raising prices," the minister said on Tuesday.          He added that if the commodity prices sky-rocket, they would adversely disadvantage the business players left with excessive stocks that remain unsold during this upward trend, which will further lead up to a drastic price drop.          The minister acknowledged that the government faced difficulties in controlling price increases because it had no agency in charge of conducting market operations for basic necessities other than for rice.          The government only has the logistics agency (BULOG) that has authority to conduct market inspections on rice.  "Bulog can launch market operations to stabilize rice prices, but the other necessities such as eggs are left to the market mechanism in order to decide prices," the minister asserted.         Suswono said that during the run-up to the fasting month, prices increased but they would begin to drop after the first week of Ramadan, and would increase yet again during the post-fasting Idul Fitri Lebaran festivities.          Therefore, the minister called on the people to not panic during this upward trend. "Public panic could adversely be taken advantage of by traders to overly raise prices," said the agriculture minister.         He said that the main problem facing the markets was logistics and distribution. The rise in prices was due to the scarcity of food items in circulation. The scarcity would not have taken place if distribution was running well and smoothly.         Therefore, the government is now preparing transportation facilities to streamline the inter-island distribution of commodities, including cattle.         "Now, beef stocks are enough. Stocks of slaughter cows are also adequate because we have a headcount of 150,000 cows that can be supplied if there is a significant price rise," the minister concluded. ***2*** (T.A014/INE/o001) (T.A014/A/KR-BSR/O001) 18-07-2012 14:19:47