WRONG planning and governance is considered to make it difficult for the government to control food prices. It is predicted that price spikes will continue to occur and add to people’s difficulties as consumers.
This is because the increase in food prices during Ramadan and Eid is a seasonal phenomenon. Control will be increasingly difficult because a number of food commodities take time to be produced and distributed to the market.
“Prices for ingredients that are not currently in the harvest season will be high. But if they are harvested they will be somewhat under control. For example, rice, we have just entered the harvest season, the price may drop slightly, although it is still higher than January-February then,” said Executive Director of the Institute for Development of Economics and Finance (Indef) Tauhid Ahmad when contacted, Thursday (7/3).
One food commodity whose price increases will be difficult to control is eggs. Because egg production cannot be done quickly or using instant options such as importing rice.
It is estimated that the increase in egg prices will be difficult to suppress. The price of this commodity is projected to continue to rise along with the increase in demand during Ramadan and Eid al-Fitr 2024. “There are still eggs at Rp. 30 thousand per kg, this is very high. Others also seem to be difficult, because now it is the rainy season, it will heavy for chilies,” said Tauhid.
He assessed that the government had failed to address the issue of food prices and availability. This is reflected in the conflict over rice prices which have been quite high in recent times. However, at the same time, policy makers are also aware that rice production has decreased due to El Nino.
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“Indeed, this price control is not well planned, not well managed. They say the stock is safe, but the goods are difficult to obtain, difficult to get on the market. If it were safe, prices would not be this high. So it is not controlled,” said Tauhid.
“The government itself actually knows that production will fall due to El Nino, the harvest season being delayed, but the existing stock is very low and not well anticipated,” he continued.
So, the price increase which is expected to continue during Ramadan and Eid al-Fitr will have an impact on people’s spending ability. Tauhid believes that this will suppress household consumption growth, even though it is relatively minor.
The reason is that the lower levels of society have received a lot of stimulus from the government in the form of food and cash. Therefore, it is said that pressure on household consumption will occur, although it will not significantly erode overall purchasing power.
“So in general it is relatively down but not too drastic. The pressure is definitely there because there are inflation expectations too, traders can for various reasons increase prices during Ramadan and Eid,” said Tauhid. (Mir/Z-7)
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