JAKARTA, Sept. 21 (Xinhua) -- Indonesia is stepping up efforts to end the country's reliance on soybean imports as President Joko Widodo has instructed the National Food Agency (BPN) to set a reference selling price for soybeans grown by local farmers.
The planned reference price is to encourage farmers to grow soybeans to boost the production in the archipelago.
Soybeans are the primary material for making tofu and tempeh, a traditional Indonesian food made from fermented soybeans.
The president instructed the BPN during a closed-door meeting on soybean productivity management on Monday.
In a press statement, the BPN's chairman Arief Prasetyo said that the reference price for soybeans bought from farmers would be around 10,000 Indonesian rupiahs (67 U.S. cents) per kilogram, which should ensure a profit for farmers. However, the price policy would need to go with efforts to increase soybean farm productivity, he said.
Prasetyo said that the Agriculture Ministry had been entrusted to spur domestic production of the soybean in the country with efforts including planting high-yielding varieties and using genetically modified organism (GMO) seeds.
By using GMO seeds, it is estimated that soybean production per hectare can increase from 1.6 to 2 tonnes per hectare to around 3.5 to 4 tonnes per hectare, said Prasetyo.
Meanwhile, Coordinating Minister for Economic Affairs Airlangga Hartarto said that the president wanted Indonesia to completely stop importing soybeans after seeing the national soybean production continuing to decline and getting more difficult to meet the 2.4 million tons of domestic demand.
Hartarto said that local farmers had become reluctant to grow soybeans because of the current unprofitable selling price.
Farmers are not interested in growing soybeans if the price is below 10,000 Indonesian rupiahs per kilogram. Meanwhile, the price of soybeans imported from the United States is only 7,700 rupiahs or even cheaper, he explained.
Hence, state-owned companies have been instructed by the president to buy locally produced soybeans at the predetermined price.
Hartarto also said that the government had prepared a budget allocation to expand the soybean farming area from the current 150,000 hectares to 600,000 hectares next year, as the government aimed to increase it to 1 million hectares in between two and three years.