Indonesia to Halt Palm Oil Exports Starting from the 28th

Decision to Halt Exports Amid Soaring Domestic Cooking Oil Prices
Indonesia Accounts for Over Half of Global Palm Oil Market Supply

[Asia Economy Reporter Han Jinju] Indonesia, struggling with a shortage and soaring prices of cooking oil, has decided to halt exports of palm oil and its raw materials used for cooking oil starting from the 28th.

As Indonesia, the world's largest palm oil exporter, made the decision to stop exports, concerns have arisen that international cooking oil prices will skyrocket, leading to a rise in food prices.

On the 22nd (local time), President Joko Widodo announced, "From the 28th, exports of cooking oil and raw materials for cooking oil will be banned until further notice," adding, "We will continuously monitor and evaluate the implementation of this policy to ensure that cooking oil is supplied sufficiently and at affordable prices within Indonesia."

Indonesia accounts for more than half of the global palm oil market supply. Palm oil is used as a raw material for cooking oil, processed food manufacturing, cosmetics, detergents, and biodiesel.

Since last year, international palm oil prices have risen, and due to the Ukraine crisis this year, prices have surged, causing cooking oil prices to increase and shortages to occur in the Indonesian domestic market.

The export disruptions of Ukraine and Russia, the first and second largest exporters of sunflower oil, are also cited as causes of the cooking oil crisis. The international prices of vegetable oils, including palm oil, have soared, and during this process, producers have focused on exports.

The Indonesian government imposed domestic supply obligations in response to the 'cooking oil crisis' but abolished them after domestic prices rose. Since then, it has increased export taxes and levies to provide subsidies for domestic cooking oil prices.

Nevertheless, due to the lack of effectiveness, the decision was made to suspend exports of cooking oil and raw materials.

On the 20th, President Jokowi said, "Despite the government providing subsidies for cooking oil, market prices remain high and supply is insufficient," adding, "The reason cooking oil prices are so high is because producers are focusing on exports due to expensive international prices."

This content was produced with the assistance of AI translation services.