Indonesia Halts Palm Oil Exports due to National Shortage

Southeast Asia’s most highly-populated country and the world’s top palm oil producer, Indonesia, officially banned all exports of palm oil last Thursday, April 28 due to a national shortage of palm oil. Indonesian officials stated that this embargo includes all exports of the palm oilseed and not just its edible oils.

Coordinating Minister for Economic Affairs Airlangga Hartarto states, “All products,” including crude palm oil, “are covered by the Ministry of Trade regulation and will be enforced,” and Indonesian President Joko Widodo says their top priority is to supply for the country’s 270 million citizens. Indonesian consumers have been challenged with having to queue for hours just to buy the commodity in distribution centers. Widodo’s popularity has also decreased due to the rising food prices in the country, which started various protests in many cities as well.

Although palm oil supply has already been problematic since the start of 2022, the shortage has further intensified with producers being hesitant to sell domestically due to higher profits earned from exports. Only one-third of Indonesia’s palm oil supply is consumed by its domestic market, and its top export customers are China, India, Pakistan, and the European Union. Indonesian consumers have also expressed their difficulty with the shortage, such as Lius Antoni who remarked, “Cooking oil was difficult to find, even in bulk. I finally decided to reduce the use of cooking oil.” Meanwhile, fried snack vendor Ade Neni states, “The high oil prices have reduced my sales. I had to increase the price of my gorengan.”

The prices of cooking oil have reached up to 26,000 rupiahs ($1.80) in the past weeks. Jakarta will be resuming operations on palm oil exports when bulk cooking oil prices have lowered to 14,000 rupiahs (97 cents) per liter.

Source: ABS CBN News