Faced with shortage, Indonesia suspends all palm oil exports
Trucks full of palm fruits in front of a palm oil factory in Siak, Indonesia, April 26, 2022. REUTERS - WILLY KURNIAWAN
Text by: RFI Follow
2 mins
A few days before the Eid celebrations, Indonesia ended Thursday, April 28, palm oil exports to protect its domestic market, appease the anger of the population in the face of empty shelves and soaring prices.
A decision that could in turn cause problems in various importing countries.
On the financial markets, the price of this commodity, present in various forms in half of supermarket products, continues to rise.
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With our correspondent in Southeast Asia,
Gabrielle Maréchaux
According to the Indonesian president himself, the
shortage of cooking oil in
his country borders on the absurd.
"
As the world's largest palm oil producing country, it's frankly ironic that we have difficulty getting cooking oil
," said Joko Widodo.
The Southeast Asian archipelago has been facing a shortage and soaring prices of palm oil-based cooking oil on its domestic market for several months and fears a rise in social tensions.
To calm the situation, the Indonesian government has taken a radical decision, but not necessarily effective, says Dr. Sathia Varqa, head of Palm Oil Analytics.
"
The government has pressed the 'panic' button by banning all exports. It's a popular measure, but I don't think it will work because the real problem here is not yield. It's distribution. for the domestic market, from refineries to packaging, to retailers
", he underlines.
Oil stain
In a last-minute U-turn on Wednesday evening, authorities clarified that the suspension would affect all oilseed exports, not just products for edible oils, as reported a day earlier.
► Read also: Nothing stops palm oil prices
And on a global scale, many countries could soon experience the same ordeal as the Indonesians.
"
China, India, Pakistan, Bangladesh, Egypt will be the first to suffer: prices are already high, and they will continue to rise
," he said.
In neighboring Malaysia, growers hope the end of Indonesian exports will bring them new customers.
Not sure, however, that the world's second largest producer of palm oil has the means to achieve its ambitions: after two years of pandemic, foreign workers, who represent 80% of the workforce on the plantations, are sorely lacking and Malaysian yields are historically low.
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Indonesia
consumption
Trade and distribution
Food