Goverment Streamlines Distribution of Subsidized Fertilizers

IDXChannel - The government has simplified the distribution of subsidized fertilizers for farmers, Coordinating Minister for Food Affairs, Zulkifli Hasan. 

Earlier, the process involved complex regional regulations. It has now been streamlined into a three-tier system of distribution, Hasan announced after a coordination meeting in Jakarta.

Under the three-tier system: the Ministry of Agriculture will directly distribute fertilizers to farmer groups (gapoktan) through state-owned fertilizer enterprise Pupuk Indonesia.

"The Ministry of Agriculture will be responsible for issuing the decree. There will be no involvement from regional governments or other ministries," Hasan said.

The minister added that a presidential regulation (Perpres) will be issued to formalize the simplified distribution process. The Perpres is expected to be finalized within a month.

"We will soon submit the Perpres, and we aim to finalize it within a month. Starting from January, February, and onwards, fertilizer distribution should no longer be a problem," he said.

In addition to simplifying the distribution process, the government has doubled the volume of subsidized fertilizers from 4.7 million tons to 9.5 million tons.

"The fertilizer volume has been doubled, and we are now basing it on quantum, which is 9.5 million tons per year. If the land area increases, we will adjust the volume accordingly," Minister of Agriculture, Andi Amran Sulaiman, said.

Earlier, deputy president director of Pupuk Indonesia, Gusrizal, said that the current stock of subsidized fertilizers in the country stands at 1.2 million tons, exceeding the minimum requirement of 175 percent set by the Minister of Trade.

To ensure consistent availability, the government will prioritize distribution during each planting season, he informed.

The government led by Prabowo Subianto has set an ambitious goal to achieve food self-sufficiency to reduce reliance on food imports and ensure food security for Indonesia's growing population.

However, Indonesian farmers often encounter significant challenges in accessing subsidized fertilizers, which are crucial for maintaining agricultural productivity.

Due to misappropriation by intermediaries and local officials, subsidized fertilizers are often diverted from the intended recipients to black markets, where they are sold at higher prices.

Last month, police in Garut district, West Java, seized 25 tons of subsidized fertilizer, which was being illegally hoarded and resold at inflated prices.

Police found the subsidized fertilizer, comprising 232 sacks of urea and 283 sacks of NPK Phonska, during a raid at a warehouse in Cimuncang village.

The police chief said that the suspect, a 49-year-old resident of Garut city sub-district, purchased the subsidized fertilizer from authorized retailers and resold it at prices that were significantly higher than the government-mandated highest retail price.

The subsidized urea fertilizer, whose government-mandated price is Rp2,250 per kilogram, was being sold by the suspect for Rp4 thousand per kilogram. Similarly, the NPK Phonska, which is supposed to be priced at Rp2.300 per kilogram, was being sold for Rp4.500 per kilogram.

Complex bureaucratic procedures and requirements also tend to deter farmers from applying for and receiving subsidized fertilizers.

(Dian Kusumo Hapsari)