"We will start this week, definitely this week," he confirmed here on Wednesday.
The minister said that several factors have contributed to the increase in the price of cooking oil in the market, including a spike in the price of crude palm oil (CPO), which is the main raw material for cooking oil.
He said that the increase in crude palm oil prices was among the national goals, since Indonesia is the largest palm oil producer globally.
In 2021, the value of the nation's palm oil exports reached US$27 billion, the highest ever in Indonesia's history, he noted.
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Each ton of oil was valued at up to US$1,320, thereby affecting the price of cooking oil, he explained.
Lutfi said that the government is expediting efforts to make cooking oil as affordable as possible by capping its price at Rp14 thousand (US$1) per liter.
The government will use the mechanism of the Palm Oil Plantation Fund Management Agency and subsidize the oil by Rp3 thousand per liter, he disclosed. A total of 1.2 billion liters of simple packaged cooking oil will be distributed in the first six months of 2022, he said.
The policy may be extended by another six months in the event that the price of cooking oil in the market remains high, he informed.
"This 1.2 billion liters is for six months; so we predict prices will be much lower and stable after six months. If it turns out that prices are unstable and not going down, we will continue again for the second six months, thus the total is 2.4 billion liters," he expounded.
Related news: Cooking oil industry plays significant role in economy: Ministry
Translator: Sugiharto P, Mecca Yumna
Editor: Rahmad Nasution
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