The review was undertaken in response to anxiety expressed by the public and retailers over the high price of cooking oil in the market.
"Based on the results of field checks, we found that cooking oil is not rare, but the price is expensive because the production process uses CPO (crude palm oil) whose price is also high in the world (markets)," Sulendrakusuma said in a statement issued in Jakarta on Wednesday.
KSP continues to monitor food commodity prices regularly in traditional markets and at modern retailers, he informed.
Based on the KSP's monitoring, the price of packaged cooking oil in several markets, in Central Jakarta as well as East Jakarta, is currently pegged at around Rp20 thousand–Rp21 thousand per liter, he said.
Meanwhile, bulk cooking oil is priced around Rp19 thousand–Rp20 thousand per kg, he added.
He further said that the government is currently finalizing a plan to provide 1.2 billion liters of cooking oil in simple packaging over six months at a price of Rp14 thousand per liter.
The price difference of Rp3.6 trillion between the actual and subsidized cost will be bridged by budget support provided by the Palm Oil Plantation Fund Management Agency (BPDP KS), he informed.
The President has asked the Minister of Trade, the Minister of Industry, the Minister of Finance, and the president director of the Oil Palm Plantation Fund Management Agency (BPDPKS) to accelerate the implementation of this policy, Sulendrakusuma said.
To make market operation policy effective, the government must involve all market networks, he advised. He said he believes that the supply of crude palm oil (CPO) to cooking oil producers needs to be secured so that price increases can be mitigated.
“The subsidy program must also be managed. The government will identify retailers to consumers, or perhaps create systems such as consumer cards. Do not let the Rp3.6 trillion that was disbursed go to producers again. Because this is not a subsidy for producers, this is a subsidy for consumers," Sulendrakusuma said.
Meanwhile, Speaker of the Indonesian House of Representatives (DPR RI) Puan Maharani asked the government to promptly control the soaring prices of basic necessities, especially cooking oil because it could add to the people's burden during the COVID-19 pandemic.
"The prices of several basic needs, such as eggs, onions, and chili, remain unstable since the end of last year. Cooking oil remains expensive, even though the government has set a reference price at Rp14 thousand per liter," Maharani said.
President Joko Widodo (Jokowi) has for long asked his staff to control the prices of basic necessities, she noted. However, the prices have remained high as of the second week of 2022, she added.
Related news: Cooking oil industry plays significant role in economy: Ministry
"The relevant ministries and regional governments (Pemda) need to quickly implement the instruction of the President. Immediately control the prices of basic needs in order to ease the people's burden," she said.
The House Speaker urged the government to distribute subsidized cooking oil evenly to reduce cooking oil prices.
She asked the government to carry out strict supervision because, based on information from traders in traditional markets, the cooking oil price from supply agents remains high.
The government should also prepare technical guidelines for local governments regarding the distribution of subsidized cooking oil, which will be sold at a lower price, she added.
"We also call on the regional governments to hold cooking oil operations at local markets in order to help the community, especially the lower middle-class citizens whose economy has not been stable due to the COVID-19 pandemic," she said.
Related news: People awaiting gov't intervention in cooking oil price: DPR
Translator: Rangga P, Azis Kurmala
Editor: Rahmad Nasution
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