OPTIMIZING REGIONAL FOOD RESERVES: STRUCTURAL INTERVENTIONS TO PREVENT PRICE VOLATILITY AND IMPRO S FARMERS’ TERMS OF TRADE IN ACEH

Abstract

Food security is a fundamental pillar of regional sovereignty and public welfare. Although Aceh Province recorded a physical rice production surplus of 1.6 million metric tons in 2025, economic realities reveal a paradox: high inflation in rice prices (as measured by the Consumer Price Index), which erodes the purchasing power of vulnerable communities, coupled with stagnation in the Farmers’ Terms of Trade (NTP). This policy paper examines this anomaly, which stems from market system failures due to the absence of state-owned off-taker institutions. Consequently, the supply chain is exploitatively dominated by a middleman oligopsony a condition further exacerbated by supply vulnerabilities caused by the threat of hydrometeorological disasters. Using a qualitative case study approach, this study analyzes the problem using a Fishbone diagram, a USG matrix, and the TOWS strategy. The results of the SWOT quadrant analysis place the institutional position in Quadrant II (ST Strategy), which requires aggressive diversification maneuvers. Using William Dunn’s policy feasibility test, this study recommends the issuance of a Governor’s Regulation on “Hybrid Food Reserve Partnerships.” This policy integrates provincial food-sector state-owned enterprises (BUMD) as downstream stabilizers and village-owned enterprises (BUMDes) funded by the Village Fund as upstream grain absorbers. This collaborative intervention is not merely about meeting bureaucratic targets but is an efficient manifestation of human rights protection aimed at breaking up food cartels, safeguarding the purchasing power of urban consumers, and elevating the economic dignity of Acehnese farmers without straining the region’s fiscal capacity.

Keywords: Regional Food Reserves, Food Trade System, Provincial Food-Sector BUMDs, Village Fund, Farmers’ Terms of Trade, Inflation.