"The government will subsidize bulk palm oil to Rp14 thousand per liter, and the subsidy will be based on funds from the BPDP-KS (Palm Oil Plantation Fund Management Agency)," he informed at an online press conference from the Presidential Office, Jakarta on Tuesday.
The subsidy for bulk cooking oil will be provided taking into account the current situation and conditions regarding the distribution of cooking oil, he explained.
"The government pays attention to the distribution situation and circumstances of the distribution of cooking oil and pays attention to the global situation and conditions where prices are rising, including vegetable oil and palm oil," he added.
He said that the price of other packaged cooking oil, such as simple and premium packaged oil, can be adjusted to the existing economic value, so it is hoped that cooking oil will remain available in modern and traditional markets.
"For this reason, the National Police chief (General Listyo Sigit Prabowo) will ensure the availability and smooth supply of supplies," he said.
Based on data from the Strategic Food Price Information Center (PIHPS), as of Tuesday, the average retail price of bulk cooking oil on the market is Rp16,650 per kilogram.
Trade Minister Muhammad Lutfi earlier confirmed that the ministry had increased the domestic market obligation (DMO) required for exporters of cooking oil products from 20 percent to 30 percent.
"We have decided that the DMO will be 30 percent and will be (implemented) starting tomorrow. Hence, all companies that export their cooking oil products must observe the 30-percent DMO requirement," Lutfi said.
The minister highlighted issues pertaining to the distribution of cooking oil in several regions and the necessity to ensure sufficient stocks for the industry as factors that necessitate an increase in the percentage.
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The policy will be enforced until the cooking oil stocks and condition returns to normal or when every resident has purchased cooking oil within the maximum price allowed by the government, he said.
The government has set the maximum retail price for bulk cooking oil at Rp11,500 (US$0.7) per liter, while cooking oil in simple packaging is being sold at Rp13,500 (US$ 0.94) per liter, and cooking oil in premium packaging is being sold at Rp14 thousand (US$0.98) per liter, Lutfi stated.
The minister noted that during the period from February 14 to March 8, 2022, the ministry expedited efforts to distribute cooking oil in various cities and districts.
As per the ministry’s records, 2,771,294 tons of crude palm oil and derivative products were exported, with the issuance of 126 export permits from 56 exporting companies, he added.
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Translator: Indra AP, Azis Kurmala
Editor: Rahmad Nasution
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