JAKARTA | The Financial Services Authority (OJK) is encouraging farmers and fishermen to utilize warehouse receipts.
Chairman of the OJK Board of Commissioners, Muliaman D Hadad, stated that the use of warehouse receipts aims to break the chain of middlemen, who often cause commodity prices to become unstable in the market.
"To manage oversupply and prevent prices from falling, farmers can store their commodities in warehouses," he said in Jakarta on Wednesday (1/6/2016).
Muliaman mentioned that another benefit of warehouse receipts for farmers is that they can be used as collateral for obtaining credit. "I see that banks are still absorbing only a small number of warehouse receipts as guarantees for providing credit to farmers," he explained.
The warehouses themselves, Muliaman continued, must have integrity, be certified, and have a guarantor, such as Perum Jamkrindo, which serves as the guarantor for farmers' receipts.
"This is a solution for marketing harvest yields. Many other countries have adopted this system, and it has been proven to stabilize prices," he said. (Source: Inilah.com)