Indonesia Moves to One-Price Rice Policy as Government Absorbs Distribution Costs

JAKARTA, Investortrust.id — The Indonesian government plans to implement a nationwide one-price policy for medium-grade rice in 2026 as part of a broader effort to reduce regional price disparities and strengthen food security. The policy, announced on Monday, Jan 12, 2026 in Jakarta, will standardize retail prices across the archipelago, with the state absorbing additional logistics costs.

The initiative was outlined by Coordinating Minister for Food Affairs Zulkifli Hasan, who said the government aimed to treat rice pricing in the same way it regulates fuel prices. “First, we want rice prices to be the same everywhere, like gasoline. Whether in Java or outside Java, the price should be the same,” he said during a press conference following a limited coordination meeting.

Under the new policy, the existing system of region-based price ceilings will be abolished. Previously, Indonesia applied different maximum retail prices across three zones, reflecting transport and distribution costs. Officials said the change was intended to ensure fairness for consumers, particularly in eastern Indonesia, where rice prices have historically been higher.

“To achieve one price, the government must cover transportation costs,” Zulkifli said. “We will pursue this in 2026 so that wherever people live, they pay the same price. Eastern Indonesia should not have to pay more.”

To support nationwide distribution, the government has approved a margin fee of 7 percent for Perum Bulog, the state-owned logistics agency responsible for rice procurement and distribution. The margin, determined by the Finance Ministry and the Financial and Development Supervisory Agency, is intended to cover the cost of transporting rice across Indonesia vast and fragmented geography.

Bulog had initially requested a 10 percent margin, but officials settled on 7 percent as sufficient. Bulog Chief Executive Ahmad Rizal Ramdhani said the adjustment was necessary given that the agency had operated with a fixed margin of Rp 50 since 2014, which he described as inadequate.

“Distribution for Bulog runs from Sabang to Merauke,” Rizal said. “This is an archipelagic country, unlike Europe, the United States, or China, where distribution takes place over one continuous landmass. Here we rely on ships, aircraft, and multiple modes of transport.”

The rice pricing reform is being rolled out alongside expectations of a stronger harvest cycle in 2026. Zulkifli said the national harvest season would begin earlier than usual, starting in February and continuing through April, rather than peaking in March as in previous years.

Rice production this year is expected to increase by between 5 and 10 percent compared with the previous year. On the back of that outlook, the government has raised its target for government rice reserves to 4 million metric tons.

“We are increasing our stock target to 4 million tons,” Zulkifli said. “This is not something done every year, but through to 2029 we want to maintain reserves at that level.”

To accommodate higher reserves, the government has instructed Bulog to accelerate the construction of 100 new warehouses. The directive, supported by a presidential instruction, aims to expand storage capacity as harvest volumes rise.

Officials said the one-price rice policy, combined with expanded storage and higher reserves, is designed to stabilize food prices, protect purchasing power, and reduce inequality across regions. The reforms mark one of the most ambitious state interventions in Indonesia rice market in recent years.