Rice Product Enforcement Does Not Automatically Make Rice More Affordable

RRI.CO.ID, Jakarta - The Indonesian government has taken action against 25 brands of fortified rice suspected of failing to meet standards and making claims on their nutrition labels that do not comply with regulations. The products have been withdrawn from the market, while authorities have been instructed to take legal enforcement measures.

The Center for Indonesian Policy Studies (CIPS), said the government’s action is important to protect consumers. However, it said the issue of rice affordability needs to be addressed more broadly.

“Taking action against products that harm consumers does not automatically make rice prices more affordable. The government still needs to look at why rice costs remain high, and whether the pricing policy is appropriate to address the issue,” CIPS Senior Researcher and Policy Analyst, Rahmad Supriyanto, said in an official statement issued Tuesday, September 22, 2026.

He said the government currently uses a Highest Retail Price (HET), policy to set price limits for certain types of rice. He said the policy can help keep prices under control in the short term. But it does not directly reduce costs incurred throughout the rice supply chain, from production and milling to distribution and retail.

When supply chain costs increase while retail prices are capped, businesses have less room to cover their expenses. For that reason, CIPS says that if market prices continue to stay above the HET, the government needs to review whether the price ceiling still reflects actual production costs and supply conditions.

CIPS also points to high production costs as one factor behind rice prices. According to its Food Monitor 2025, producer-level rice prices rose 7.97 percent in September 2025, alongside increases in prices in the agriculture and livestock sectors.

CIPS says this shows that higher consumer prices are closely linked to rising costs at the production level. The organization also says price-control policies may have limited impact if they are not accompanied by efforts to reduce production and distribution costs.

“If market prices continue to remain above the HET, the government should not only tighten enforcement against businesses. It is necessary to examine whether production, milling, and distribution costs can be reduced so that prices can be formed more efficiently,” Rahmad said.

CIPS says consumer protection and food affordability can be addressed through more targeted measures. Food assistance, for example, could be focused on low-income groups, while fortified rice as a nutritional intervention could be specifically distributed to vulnerable communities. At the same time, CIPS says fortified rice can continue to develop as a commercial product with different price and quality options, as long as its claimed nutritional benefits and content can be substantiated.

“Ensuring food affordability, particularly rice, cannot be achieved simply by pushing down prices at the consumer level. The government needs to ensure that supply increases and costs throughout the supply chain are reduced. This way, consumers can get more affordable prices without compromising the sustainability of businesses in the rice sector,” Rahmad concluded.