Bank Indonesia Reminds Bad Weather May Affect Food Supply

VIVA – Deputy Governor of Bank Indonesia (BI) Juda Agung reminded the government to anticipate the risk of bad weather early on to agricultural productivity. This is to maintain the availability of food supply to support price stability and inflation control efforts.

"The food inflation challenge this year is still quite large, we may already know that there will be a risk of bad weather due to El Nino," he said during the 2023 East Java Food Inflation Control National Movement (GNPIP) streamed virtually on Friday.

Agung stated that El Nino is a prolonged dry season that should be handled through preemptive actions, such as good irrigation management and choosing and planting crop varieties that can adapt more to the dry conditions, “We should prepare for this early if we want to maintain stability in food prices,”

Furthermore, to strengthen the steps in handling food inflation in the future, especially that arising from food prices, there are seven primary programs in 2023 GNPIP that serve as a reference point.

These primary programs include optimizing the ministry/institution and regional government budget for market operation as a strategy to control food prices to maintain people's purchasing power.

They also involve strengthening the security of horticulture and other strategic food supply, specifically for chili and shallots, which have currently become the source of inflation in several regions. The use of farming tools, machines, and facilities is also increased to boost farmers' productivity and increase the added value of their products.

The others include the expansion of cooperation between regions, support for freight cost subsidy, and information and communication technology infrastructure strengthening, including regional food balance and coordination strengthening to maintain inflation expectations.

Food data and information digitalization, as well as digitalization in agriculture, continues to be pushed through schemes, such as urban farming, digital farming, and other agriculture innovations.

"Synergy between stakeholders is certainly very important in controlling inflation and confronting challenges together this year," Agung said.

These programs are formulated by referring to the 2022-2024 inflation control road map and the 2023 GNPIP inflation-control strategy. They prioritize structural, forward-looking, and digital-based efforts to stabilize prices to support the acceleration of national economic recovery.