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Cartels And Imports As Indonesia’s Salt Crisis Worsens

A salt crisis caused by an extended wet season in Indonesia has prompted the government to import 75,000 tons from Australia, while at least one minister has floated the idea the sector is under the control of a pricing cartel.

The government has issued import permits for 75,000 tons of salt to arrive in Indonesia Aug. 10 to stem spiraling supply. The effort is intended to be a short-term solution to the problem, with locally-produced salt expected to rebound next season.

“When the harvest returns to normal, we will stop importing,” the Trade Ministry’s Foreign Trade Director General Oke Nurwan said on Friday, July 28.

Retail prices will be set by the government in the coming weeks.

Since 2016, the Ministry of Maritime Affairs and Fisheries has influenced salt imports with the government arguing the control of imports is integral to salt and fish farmers as well as fishermen.

Domestic salt production usually sits at around 166,000 tons a month, according to ministry data.

“From May to July, salt farmers only managed to produce 6,200 tons, which is far from normal,” the Ministry’s Director General for Territorial Sea Management Brahmantya Satyamurti told local media.

By Tuesday, August 1, Minister Susi Pudjiastuti was suggesting a pricing cartel, often seen in meat and chili industries, could be responsible for the severe shortage during a ministry interview.

See: Consumers Beware: Fake Peppers Close Kitchen

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Erin Cook is an Australian expat in Indonesia and the head of English editorial at Content Collision.


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