Indonesia issues licenses to import garlic as prices jump sixfold

Jakarta (The Jakarta Post/ANN) - The Indonesian Trade Ministry has issued permits to import 135,000 tons of garlic to cope with the acute shortage of the spice, which has caused a sharp increase in its price throughout the country.

The Trade Ministry's director general for foreign trade, Bachrul Chairi, said that shipments for one of Indonesia's basic cuisine ingredients would take place within two weeks.

"Import permits for around 90 percent of a total of 160,000 tons of import quota for the first half have been issued and importers seem to have verified their orders," he said in Jakarta on Friday.

The Agriculture Ministry, which is authorized to decide on imports, has set a quota of 320,000 tons for garlic imports this year.

Half of the figure will be realized in the first half of the year, while the remaining 160,000 tons will be shipped throughout the rest of the year. The statement came one day after President Susilo Bambang Yudhoyono ordered related ministers on the issue to respond quickly to the rising prices of foodstuffs.

Disruptions in the spice supply in local markets, particularly due to seasonal factors, have markedly pushed up prices over the past few weeks. The prices of shallots, also a basic ingredient in Indonesian cooking rose by up to sixfold to 60,000 rupiah (US$6.30) this week.

The steep increase in spice prices has raised concerns over a further increase in the country's inflation rate.

The increase in prices including garlic, shallots and red chilli, helped push up the Consumers Price Index (CPI) by 0.75 percent in February, driving year-on-year inflation to a 20-month high of 5.31 percent during the month.

"So far the pressure [from the price of spices] still exists. Based on our survey last week, pressure from shallots and garlic is still too high," newly appointed Bank Indonesia (BI) deputy governor Perry Warjiyo told reporters at this office.

In a move to pacify the market, the Trade Ministry also ordered the release of 332 containers of garlic retained at Tanjung Perak Port in Surabaya, Bachrul said. Hundreds of containers filled with horticulture products could not be released from the port due to licensing problems.

Bachrul said that the garlic from the containers would be gradually released to the market to help push down its price. In a normal situation, the containers without complete documents would have been returned to exporting countries.

"The prices have moved beyond the psychological limit, so we're taking concerted measures," he said.

The Dumai Customs and Excise Office in Riau province also foiled an attempt to smuggle 27 tons of shallots during an operation that took place on a highway in Pelintung subdistrict, Medang Kampai district, Dumai City last week.

Customs and excise officials seized the shallots that had been illegally imported from Thailand. The shallots were put inside 1,326 sacks, with each sack containing 20 kilograms of shallots.

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