REPUBLIKA.CO.ID, JAKARTA -- Economic observer Suroto of the Strategic Socio-Economic Cadres Association (Akses) said state-owned logistics board Bulog should be evaluated so as to improve rice trade regulations in the country.

"The government suspects that the rise in the prices of rice, which reached up to 30 percent in recent days, was caused by the rice mafia. This should not have happened if Bulog's management was performing well," Suroto noted here on Monday.

According to him, many suspect that the rice mafia was behind the recent price rise because the volume of rice stock was adequate until April and yet the prices drastically increased.

"Bulog should be evaluated because it is possible that the rice mafia has started manipulating the data of warehouses. It is also possible that distributors are hoarding rice," the Akses economic observer observed.

They could also have played games through the sale of stocks, considering the presence of warehouses in regions whose price disparity is high, and thus gained enough margin after transportation fees.

"So, they have been accumulating it; it cannot take place all of a sudden but has to be hoarded in large volumes in the warehouses of distributors," he added.

He pointed out that the sale of 'buffer stocks' can take place in regions because there are individuals who want to reap personal benefits.

"This is possible because the auditing system in Bulog's warehouses is weak. It is probably because of its management's inability or even through deliberate attempts," he emphasized.

He suggested that the short-term government should conduct a comprehensive audit of warehouse contents and immediately trace the lane of rice distribution to know the centre of hoarding.

While in the long-term, Bulog had better be returned to its former status as a buffer for food stocks and be relieved of its status as a corporation under the Ministry of State-Owned Enterprises.

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