Gov’t Forms State-Owned Food Holding to Boost Supply Chain

Jakarta. The Indonesian government on Wednesday officially launched a state-owned food holding company, which goes by the name ID Food, in a bid to boost the food supply chain.

State-run agroindustry firm Rajawali Nusantara Indonesia (RNI) will serve as the parent company of the food holding. 

ID Food encompasses salt maker Garam, agribusiness company Sang Hyang Seri, logistics company Perusahaan Perdagangan Indonesia, fishery Perikanan Indonesia, livestock company Berdikari. These five state-owned enterprises (SOEs) already have their shares transferred to RNI.

“We encourage ID Food to boost our food supply chain, which so far has been lacking [in terms of] certainty and coordination. We are talking about improvements to the SOEs’ food supply chain,” SOE Minister Erick Thohir said at ID Food’s launch in Jakarta on Wednesday.

Indonesia’s supply chain is currently facing uncertainty, according to Erick. 

Soaring crude palm oil (CPO) price has made cooking oil more expensive. Although the high CPO price is a boon to export, households are worrying about the skyrocketing palm oil price.

“The price of fertilizer raw materials also jumped up to threefold,” Erick added.

The minister urged ID Food to embrace technology and make innovations, so Indonesia’s food products could compete on a global scale. 

“Neighboring countries already have their flagship products based on research and technology. research and technology. And here we are still stuck with our supply-demand,” Erick said.

Trade Minister Muhammad Lutfi projected that demand for staples would likely exceed its supply in 2022. To meet the high demand, the Trade Ministry is preparing the logistics and procurement.

“We do hope that ID Food can help the government in making sure that the [staple] goods are available and affordable,” Lutfi said. 

The ID Food holding aims to strengthen national food security and drive inclusivity of farmers and fishermen, according to RNI president director Arief Prasetyo Adi.

“We wish to become a world-class food company. Hopefully, this holding can play a bigger role in the national food ecosystem for the Indonesian people,” Arief told the same conference.

The Presidential Staff Office recently conducted a survey on cooking oil prices in Jakarta's markets, news outlet Antara reported on Wednesday.

Packaged cooking oil price in several markets in Central Jakarta and East Jakarta reaches about Rp 20,000-Rp 21,000 (about $1.39-1.46) per liter, whereas bulk cooking oil is priced at Rp 19,000-Rp 20,000 per kg.