Food is a human basic need and its provision should be secured by the government. In this regard, the government must control the stability of food price particularly in urban areas in which its food demand depends mostly on food supply from surrounding areas as a food buffer. However, the current food buffer system for urban areas has not been able to stabilize food price volatility experienced every year. This is triggered by: first, food supply for urban areas tend to be “business to business” practices. Second, there is no set of regulations that forms the legal framework for cooperation and coordination in the food sector especially between urban and peri-urban areas. The study aims at reviewing and designing food buffer system for urban areas to stabilize food price fluctuation. The study included a case study of food buffer system in Jakarta. Document study and interviews with farmer associations, food traders and local government were conducted. The result shows that institutional innovation for Food Distribution Center could address the challenges of price fluctuation. To do so, a set of legal and policy frameworks on intra-region cooperation between urban and the surrounding areas on food sector is totally required.
Key words: Food buffer system, urban areas, regulation.
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