Indonesian Farmers Exchange Rate (FER) Sees December Surge: A Key Indicator of Agricultural Economic Dynamics

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Indonesian Farmers Exchange Rate (FER) Sees December Surge. Photo by: Daffa Althaf Nursukma / Raihan Aidilah

PALMOILMAGAZINE, JAKARTA – In December 2023, the Farmers’ Exchange Rate (FER) in Indonesia saw a 0.88 percent increase compared to the previous month, reaching 117.76. FER represents the comparison between the price index received by farmers (FG) and the price index paid by farmers (FP). It serves as a crucial indicator to assess the purchasing power of farmers in various villages.

According to an official statement from the Central Bureau of Statistics (CBS) to Palmoilmagazine.com on Wednesday (3/1/2024), the national-scale FER for January to December 2023 stood at 112.46, with FG at approximately 131.59 and FP at around 117.01. This increase is attributed to a rise in FG by about 1.29 percent, surpassing the FP increase of 0.40 percent.

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The notable increase in FER was particularly evident in December 2023, with Central Sulawesi Province experiencing the highest rise at 2.22 percent. This reflects positive economic potential in the agricultural sector. Conversely, North Maluku witnessed the most significant decrease in FER, reaching 0.88 percent, indicating challenges faced by the region.

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Besides, the increasing housing consumption index that reached 0,53 percent in December 2023 contributed to the increasing FER. It happened for the increasing index of some big group of expense. This reflected the increasing consumption in the society.

Meanwhile agriculture housing business exchange (AHBE) in national scale in December 2023 reached 119,68, increased 1,17 percent to the previous month. AHBE is the significant indicator to know the agriculture housing business that correlated with economic progress in the sector.

The increasing FER and AHBE delivered hopes to escalate the farmers’ welfare and agriculture housing business in Indonesia. The analysis to the influencing factors that could change would be the basic to get better policy to support economic progress and welfare agricultural society. (T2)

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