IndonesiaMarket Insights

Indonesia Kicks Off National Food Project to Tackle Possible Crisis

By 5 October, 2020June 30th, 2023No Comments

Indonesian rice farmer

Indonesia’s government kicks of its national food program aiming to relieve the country’s reliance on food imports and deal with a possible global food crisis caused by the COVID-19 pandemic.

Indonesia has long been one of the top global importers of wheat and rice. In 2018, the country imported approximately 10.1 million tons of wheat which made it the biggest wheat importer globally. Moreover, Indonesia ranked second in rice imports, only after China, with 1.85 million tons. Although Indonesia’s rice production is among the top 3 worldwide, the domestic supply cannot meet the demand of this fourth largest populous country with a high rice consumption per capita. Hence, Indonesia needs to import large quantities of rice every year, mainly from Thailand and Vietnam.


Graph showing biggest wheat importers 2018

Graph showing biggest milled rice importers 2018

Last year, the Food and Agriculture Organization of the United Nations warned about high food insecurities due to conflicts, climate change and economic turbulence. Now, the spread of the COVID-19 virus have accelerated the negative outlook of food shortage due to disrupted food supply chains, decreased purchasing power, reduction in production and distribution capacity. Therefore, in this context, the fact that Indonesia relies on food import makes the country more exposed to a food shortage risk.

Considering the above jeopardies together with the goal to be rice self-sufficient, the Indonesian government decided to run a food project to grow rice, corn and other staple crops to secure food reserves for the upcoming years. In the first stage, the project is expected to cover an area of 770,000 hectares among which 148,000 hectares is for rice and 622,000 hectares is for other crops, such as corn and cassava. By the end of 2025, the food project will be expanded to cover a total of 1.4 million hectares throughout the many islands of Indonesia. Planting is planned to start by the end of 2020.

The government aims to make Indonesia an agricultural center with developed technology and a skilled labor force. Rice fields will be enlarged, and agricultural production will grow. Indonesia hopes the project will help ensure national food stockpiles and drive the development of the agricultural industry of Indonesia. However, experts have expressed concerns that this project needs thorough environmental studies in order to foster those positive effects without damaging the environment, because the project will be developed on degraded peatlands which may cause flooding and forest fire in the longer run.

In conclusion, being food self-sufficient has long been a priority for the Indonesian government. The development towards it has been accelerated by the COVID-19 pandemic, as it has paralyzed the economic and social sectors in various countries, and threatened food availability worldwide. Therefore, the food security project is believed to fulfill the national food reserves in the future as well as develop the food production of the country, but possible environmental impacts need to be considered to ensure sustainability of the development.

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