"Imported rice is much cheaper compared with domestic rice and this has put pressure on the prices of the staple grown locally," said the trader, adding the rice was imported from Thailand, China and Vietnam. He said retailers sold imported rice at 2,100/2,200 rupiah/kg while local rice was priced at 2,500/2,600 rupiah/kg. Trade and Industry Minister Rahardi Ramelan said on Thursday Indonesia's rice stocks stood at 2.8 million tonnes.

Harvesting is on in the main island of Java, Indonesia's rice bowl. Bulog said on Friday that from January to end-June, it had bought 1.5 million tonnes of rice from local farmers. Itimported 230,000 tonnes of rice in June. Bulog has indefinitely postponed its fresh rice tender for 75,000 tonnes of rice, originally scheduled for June, to reestimate the local crop as well as the local supply situation.

Indonesia's unhusked rice production would rise 0.39 per cent to 48.66 million tonnes this year, official data showed. It imported 4.1 million tonnes of rice in 1998 and this year's imports is expected to reach three million tonnes. Corn, too, is under pressure from rising imports. One trader in Bandar Lampung, said falling prices on the Chicago Board of Trade and a strong rupiah could boost corn imports. "Based on my calculations, imported corn hovers around 740 rupiah/kg, compared with 1,000 rupiah/kg for corn."