July 7, 2026
 

Indonesia launches Rp678 billion feed corn subsidy as broiler farm-gate prices collapse

The government is distributing 213,200 tonnes of subsidised corn through Bulog to help smallholders whose production costs are running nearly double current farm-gate prices.

Indonesia's National Food Agency (Bapanas) has launched a Rp678 billion (approximately US$41.6 million) feed corn subsidy programme under the Food Supply and Price Stabilisation scheme, deploying state logistics agency Perum Bulog to distribute 213,200 tonnes of subsidised corn to poultry farmers throughout 2026 as broiler farm-gate prices sink well below production costs.

Broiler prices at the farm gate have fallen to Rp13,000-14,000 per kilogram (approximately US$0.80-0.86/kg), against a production cost of Rp22,000-23,000/kg (approximately US$1.35-1.41/kg). In major production centres such as Blitar and Magetan in East Java, farm-gate prices have dropped as low as Rp17,000/kg.

Since the programme commenced on 9 May, the government had delivered 55,500 tonnes of corn to 5,543 micro and small-scale farmers across 26 provinces as of 29 June, covering a combined flock of 53 million birds. Bapanas procures corn directly from domestic farmers at a guaranteed price of Rp5,500/kg, storing it as the Government Corn Reserve before releasing it to registered cooperatives and farmer associations at Rp5,000-5,500/kg - below prevailing market rates.

"We buy early to protect the farmers. We store this as the Government Corn Reserve to be released whenever poultry producers need support," said Bapanas Head Andi Amran Sulaiman.

The pricing dislocation extends beyond broilers. Maino Dwi Hartono, Director of SPHP at Bapanas, noted that egg farmers are receiving as little as Rp21,000/kg at the farm gate while the official consumer reference price stands at Rp30,000/kg. Asep Saepudin, representing the Indonesian Independent Poultry Farmers Association (Permindo), described conditions in West Java as unsustainable. "Prices at Rp13,000-14,000 in West Java are unbearable. This is a catastrophe for independent farmers," he said.

To support demand recovery, the government is directing the Free Nutritious Meal programme to source directly from local poultry farmers from mid-July. Officials expect seasonal factors, including the end of school holidays and increased consumer spending, to provide additional demand support in the coming months.

- JournalArta