G/STR/N/18/IDN  
6 October  2020 
(20-6803) Page: 1/6 
Working Party on State Trading Enterprises   
 
  
STATE TRADING  
NEW AND FULL NOTIFICATION PURSUANT TO ARTICLE XVII : 4(A) OF THE   
GATT 1994 AND PARAGRAPH 1 OF THE UNDERSTANDING ON   
THE INTERPRETATION OF ARTICLE XVII  
INDONESIA  
The following communication, dated 29 September  2020, is being circulated at the  request of the 
Delegation of Indonesia.  
 
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Pursuant to Article XVII:4(a) of the GATT 1994 and paragraph 1 of the Understanding on the 
Interpretation of Article  XVII of the GATT 1994, and in response to the call for notifications set forth 
in document G/STR/N/18, Indonesia makes the following new and full notification of its state trading 
enterprises for 2018 and 2019.  
I. ENUMERATION OF STATE TRADING ENTERPRISE  
A. Identification of State Trading Enterprise  
Perum BULOG, as a State Trading Enterprise.  
B. Description of products affected (including tariff item number(s) encompass ed in 
the product description)  
Rice (HS 1006).  
II. REASON AND PURPOSE  
A. Reason or purpose for establishing and/or maintaining state trading enterprise  
• The purpose of establishing Perum BULOG as a State Trading Enterprise (STE) is to 
conduct good quality and sufficient staple food logistics businesses for all society 's 
needs ; and in some cases, to c onduct particular tasks given by the Government in light 
of stabilizing staple food prices, managing government food reserves and distributing 
staple food to low income people, particularly rice and other staple food items 
determined by the Government in t he pursuit of achieving national food security.  
• In implementing its statutory functions, the agency engages in domestic procurement, 
sales/distribution, import/export and public stockholding.  
B. Summary of legal basis for granting the relevant exclusive or sp ecial rights or 
privileges, including legal provisions and summary of statutory or constitutional 
powers  
The operations of Perum BULOG are governed by the recent State -Owned Enterprise  
Law No 19/2003, the provisions of Food Law No. 18/2012, the Presidentia l Instruction  No. 5/2015 G/STR/N/18/IDN  
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  and the President Regulation No. 48/2016 . BULOG was established under  the Presidential 
Decree  No. 114/U/Kep/5/1967 . Since 2003 BULOG was transformed  from a non -departmental 
government agency into a State -Owned Enterprise, namely  Perum BULOG , by Government 
Regulation No. 7/2003, as amended by Government  Regulation No. 61/2003.  
III. DESCRIPTION OF THE FUNCTIONING OF THE STATE TRADING ENTERPRISE  
A. Summary statement providing overview of operations of the state trading ent erprise  
• Conducting domestic paddy/rice procurement for defending guaranteed price;  
• Ensuring domestic rice price stabilization;  
• Carrying out domestic paddy/rice procurement with the Government Purchase Price 
(HPP);  
• Distributing rice for poor and vulnerable people, Internally displaced persons (IDPs), 
and victims of natural calamities and social conflicts;  
• Maintaining national reserve stockholding for food security purposes;  
• Undertake government mandate to import for price stabilization to ensure f ood security 
objective.  
B. Specification of exclusive or special rights or privileges enjoyed by the state trading 
enterprise  
• Undertake the government mandate to import/export and distribute rice, maintain 
national public stock for the price stabilization pro gramme and food security purposes;  
• In conducting its operation, Perum BULOG's source of funding comes from the state 
budget and commercial credit based on Goverment Regulations No. 13/2016.  
C. Type of entities other than the state trading enterprise that are allowed to engage 
in importation/exportation and condition for participation  
Private sector as well as STE Perum BULOG are given equal rights to the import and  export of food 
commodity, subject to special restrictions or guidelines set by the  government.  
D. How import/export levels are established by the state trading enterprise  
General provisions regarding the import and export of rice carried out by Perum BULOG are 
determined from the mandate of the Central Government . Perum BULOG is only an STE that carries  
out the mandate as written in point II.B.  
E. How export prices are determined  
Under the national regulations, the prices can be based on agreed types of transactions between 
both parties by considering many factors through tendering and/or others . Up until t his moment, 
Perum BULOG has not been assigned by the Government of Indonesia to export rice.  
F. How the resale prices of imported products are determined  
The resale prices of imported product are determined by considering the level of domestic rice price 
in order to avoid market disruption.  
G. Whether long -term contracts are negotiated by the state trading enterprise . 
Whether the state trading enterprise is used to fulfil contractual obligations entered 
into by the government  
Perum BULOG as an implementing government agency negotiates contracts or carries -out 
transactions to fulfil contractual obligations entered into by the government,  such as G overnment  to 
Government  basis, counter trade, food aid, etc.  G/STR/N/18/IDN  
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  H. Brief description of market structure  
Ever since the liberalization of rice trade, the Government of Indonesia has encouraged the private 
sector and cooperatives to participate in the local rice market . This has created a competitive market 
involving many players in the rice industry, includin g rice producers, collectors, processors and 
traders . When the market fails to function properly, especially at times when prices tend to be 
unstable at producer or consumer level, Perum BULOG intervenes in the market and smooth s out 
the price fluctuations . 
IV. STATISTICAL INFORMATION (SEE ATTACHED TABLES I -III) 
See attached Tables I, II and III.  
V. REASON WHY NO FOREIGN TRADE HAS TAKEN PLACE (AS  APPROPRIATE)  
‒  
VI. ADDITIONAL INFORMATION (AS APPROPRIATE ) 
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  G/STR/N/18/IDN  
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TABLE I  
STATE TRADING : BULOG  
STATISTICAL INFORMATION, IMPORTS  
Year Description of  
Products(s) (Including  
HS Number(s))  Total Quantity  
Imported  
(MT)  Quantity  imported by  
state trading  enterprise  
(MT)  Average  
Import Price1) 
(US $/MT)  Average  
Representative  
Price2) 
(US $/MT)  Mark  
Up 
 National  
Production3) 
(MT)  
1 2 3 4 5 6 7 8 
2018  Rice (HS 1006)  2.253.824  1.787.300  522 610  46.500.000  
2019  444.509  None 520 696  31.310.000  
Average  1.349.167  893.650 521 653  38.905.000  
 
Notes:  
1) Rice price FOB at Bangkok for 25 % broken plus insurance & transportation cost.  
2) Price of rice (quality IR III) at PIC (Cipinang Wholesale Market, Jakarta).  
3) Total production less 10 % for seed, animal feed, loss, etc.  
Sources:  
a) 2018-2019 BPS for total Import.  
b) Rice price FOB at Bangkok for 25 % broken plus insurance & transportation cost for import price.  
c) Bulog for domestic sales price at wholesale PIC (Cipinang Wholesale Market, Jakarta) ; and import by STE.  
d) Ministry of Agriculture and BPS (Central Bureau of Statistics) for national production.  
 
    
  G/STR/N/18/IDN  
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TABLE  II 
STATE TRADING : BULOG  
STATISTICAL INFORMATION, EXPORTS  
Year Description of  
Products(s) (Including  
HS Number(s))  Total Quantity  Exported  
(MT)  Quantity  exported by  
state trading   
enterprise  (MT)  Average  
Procurement Price 
(US $/MT)  Average  
Representative 
domestic sales  Price1) 
(US $/MT)  Average  
Export 
Price  National  
Production2) 
(MT)  
1 2 3 4 5 6 7 8 
2018  Rice (HS 1006)  None  None  512 610 None  46.500.000  
2019  None  None  516 696 None  31.310.000  
Average  None  None  514 653 None  38.905.000  
 
Notes:  
1) Price of rice (quality IR III) at PIC (Cipinang Wholesale Market, Jakarta).  
2) Total production less 10 % for seed, animal feed, loss, etc.  
Sources:  
a) Bulog administrated price converted for procurement price.  
b) Bulog for domestic sales price at wholesale PIC (Cipinang Wholesale Market, Jakarta) ; and import by STE.  
c) Ministry of Agriculture and BPS (Central Bureau of Statistics) for national production.  
   
  G/STR/N/18/IDN  
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TABLE II I 
STATE TRADING : BULOG  
STATISTICAL INFORMATION, DOMESTIC ACTIVITIES  
Year Description of  
Products(s) (Including  
HS Number(s))  Domestic purchases by state 
trading enterprise  
(MT)  National Production1) 
(MT)  Domestic sales by state 
trading enterprise 
(MT)  National Consumption 
(MT)  
1 2 3 4 5 6 
2018  Rice (HS 1006)  1.488.584  46.500.000  1.758.910  36.300.000  
2019  1.099.968  31.310.000  968.945  35.500.000  
Average  1.294.276  38.905. 000 1.363.928  35.900.000  
 
Notes:  
1) Total production less 10 % for seed, animal feed, loss, etc.  
Sources:  
a) Bulog for domestic purchases and domestic sales.  
b) Ministry of Agriculture and BPS (Central Bureau of Statistics) for national production.  
c) Grain Report USDA for national consumption.  
 
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