Saturday, 28 January 2023

Indonesia to remove ban on palm oil exports from Monday

Indonesia to remove ban on palm oil exports from Monday

President Joko Widodo said Indonesia would remove the palm oil export ban from Monday, following a domestic cooking oil supply recovery.

The global top palm oil exporter has, since 28 April, halted shipments of crude palm oil (CPO) and some secondary products to try to tame soaring prices of domestic cooking oil.

The decision comes even though bulk cooking oil had not yet receded to the targeted 14,000 rupiahs per liter price. The government views the welfare of 17 million oil workers in the palm oil industry, the president said in a video statement.

President Joko Widodo, as the president is known, said the supply of bulk cooking oil has now reached a level more significant than what the domestic market needed.

President Joko Widodo said.

"Average price of cooking oil (bulk) before the export ban in April was 19,800 rupiah per liter, and after the ban, the average price dropped to around 17,200 to 17,600 rupiah per liter,"

Indonesia came up with the plan to ban exports of the widely used vegetable oil to control domestic prices, but pressures have been climbed up for it to be eased as farmers protested that there was no demand for their palm fruits.

Read More: Wheat stocks in India may drop to their lowest level since ’16-17

The ban has disturbed global vegetable oil markets that were already struggling after Ukraine - Russia war removed a big chunk of sunflower oil supply.

Palm oil makes up more than a third of the world's vegetable oil market, with Indonesia accounting for about 60% of palm oil supply.

Palm oil is the most widely used vegetable oil in Indonesia and, despite being the world's biggest producer,

The shortages have, in some cases, forced consumers to spend hours in queues at distribution centers.

More than 50 percent of the world's palm oil is produced by Indonesia, with one-third consumed by its domestic market. The European Union, China, India, and Pakistan are its major export customers.

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