Writer : Edwin Shri Bimo | Editor : Vyara Lestari
PARIS/NEW YORK, KOMPAS.TV – Indonesia’s decision to suspend palm oil exports to deal with domestic shortages pushed vegetable oil prices to new highs. This is clearly further complicating the world market which is already under threat due to the war in Ukraine and global warming, according to reports Straits TimesSaturday (30/4/2022).
Prices of European palm, soybean, rapeseed oil and even its Canadian transgenic partner, canola oil, hit record highs after Indonesia’s announcement Wednesday (27/4/2022).
“We’ve had problems with soybeans in South America and canola in Canada,” said Prof Philippe Chalmin, a professor of economics at the University of Paris-Dauphine in France, who said both crops were severely affected by prolonged drought.
Then came the devastation of the “sunflower in Ukraine” disaster caused by the Russian attack, he added.
Palm oil is the most consumed vegetable oil in the world, and Indonesia accounts for 35 percent of global exports, according to Mr James Fry, chairman of consulting firm LMC.
Indonesia’s export ban is designed to lower prices domestically and overcome scarcity, Indonesian President Joko Widodo said in announcing his policy.
However, Prof Chalmin said the move “came at the worst possible time”.
He also stressed, “Prices have been going up since last year and were exacerbated by the Ukraine conflict.”
Rich Nelson of agricultural market research and trading firm Allendale said “the industry believes it will last maybe a month, maybe two (months).”
–
