Jakarta (ANTARA) – The Indonesian government is resolved to convert around 380,000 metric tons of downgraded rice into flour to maximize the commodity’s economic value while stabilizing food prices.

“Flour factories will have the opportunity to purchase deteriorated rice stocks. They can process the rice into flour, allowing for lower flour prices amid hikes,” Coordinating Minister for Food Affairs Zulkifli Hasan stated in Jakarta on Tuesday.

The processing initiative aligns with Indonesia’s natural resource downstreaming policy, which seeks greater added value for commodities by selling them as processed products rather than in raw form.

Hasan noted that the rice-to-flour conversion decision was made during a government coordination meeting held to discuss ways to fully capitalize on more than five million tons of government rice reserves.

He explained that state-run logistics company Bulog manages the rice reserves, of which a portion has declined in quality as a consequence of ample stockpiles.

The plan is to auction about 380,000 tons of downgraded rice to flour producers at a minimum price of Rp11,000 (around US$0.62) per kilogram to retain its economic value, Hasan added.

He underlined that the baseline is only slightly lower than subsidized rice offered to the public under the Food Supply and Price Stabilization (SPHP) program at Rp12,500 per kilogram.

The minister further said the rice downstreaming scheme is projected to stabilize flour prices, ensuring affordability for culinary businesses, small enterprises, and the wider public amid a rising trend.

He also described the policy as part of government efforts to keep food commodities accessible, supported by increased rice and corn allocations for the SPHP program.

Hasan expressed optimism that these measures will prove effective in maintaining favorable prices for rice, corn, and flour across the country.

Translator: M. Harianto, Tegar Nurfitra
Editor: Azis Kurmala
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Published Date: September 8, 2026