The minister noted that the project aimed to stabilize the price of fresh fruit palm bunches (TBS) in Bengkulu Province as a raw material for cooking oil.
"The government will immediately build a CPO factory in Bengkulu to stabilize the price of palm oil," Pandjaitan stated in Bengkulu, Tuesday.
He explained that the factory infrastructure will be located in Bengkulu Province under the supervision of the Palm Oil Plantation Fund Management Agency (BPDPKS).
In addition, in order to reduce the price of TBS at the farmer level, the central government will immediately empty the tanks in all palm oil mills to compel companies to buy TBS at a high price. The central government is targeting the purchase of TBS in the future to reach above Rp2,000 per kilogram.
"The president also agreed with the tank emptying approach to force companies to buy TBS at a high price," Pandjaitan remarked.
It is known that currently, TBS at the farm level is priced at Rp600 to Rp700 per kilogram, while at the factory level, it is purchased at a price of Rp900 per kilogram.
Related news: Government to expedite CPO exports to boost FFB price
The Indonesian government will encourage the acceleration of CPO exports to boost the price of TBS palm oil at the farmer level.
On a separate occasion, Minister of Trade, Zulkifli Hasan, remarked that in order to optimize the absorption of palm oil at the farmer level, CPO exports must be increased.
"If the export runs well, factories will be able to empty their tanks, and companies will buy TBS at a higher price," he noted.
Based on data from the Ministry of Trade, as of July 4, 2022, approvals for the export of CPO, Refined, Bleached, Deodorized (RBD) Palm Oil, RBD Palm Olein, and Used Cooking Oil (UCO) for the acceleration program through the bulk cooking oil domestic market obligation (Simirah DMO) scheme had reached 1.31 million tons, with a realization figure of 65.91 percent, or 885,500 tons, with 434,067 tons of unrealized volume.
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Translator: Anggi Mayasari, Resinta S
Editor: Rahmad Nasution
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