Cooking Oil Prices Go Crazy, KPPU Ends Cartel Signals: There Are Big Businessmen Who Regulate Rise Simultaneously

JAKARTA - The Business Competition Supervisory Commission (KPPU) has detected a cartel signal from the problem of the recent soaring cooking oil price. KPPU suspects that the big businessmen who control the domestic cooking oil market share will manage the increase in the commodity together.

KPPU's commissioner, Ukay Karyadi, said that cooking oil in the market was relatively increased together after the increase in crude palm oil (CPO) prices.

"This behavior can be interpreted as a signal whether this is a cartel because of property, but this must be legally proven," he said, in a virtual press conference, Thursday, January 20.

According to Ukay, the domestic cooking oil industry market tends to lead to an oligopoly structure. In addition, in the industrial structure, the big cooking oil players are suspected to be integrated with the palm oil plantation business group and some of its derivative products. This means that large cooking oil industries generally have their own oil palm plantations.

Furthermore, according to Ukay, the increase in CPO prices should not have too much influence on fluctuations in domestic cooking oil prices.

"There is no increase in production costs because the plantation is owned by itself. So even if the CPO for oil production is not increased, the cooking oil factory will still be profitable," he said.

On the same occasion, KPPU's Director of Economics, Mulyawan Ranamenggala, said that his party did not yet have solid evidence regarding the alleged cartel. However, the fact that is certain to be found is that the price of cooking oil has increased driven by the increase in CPO.

"For the alleged cartel, we don't yet have strong evidence whether a cartel was carried out, because of the analysis and facts we found in the field, that the increase in migrant prices is an increase in CPO input prices. " he said.

However, Mulyawan said that in the future KPPU will monitor the increase in CPO and cooking oil prices.

"We will continue to pay attention to fluctuations in CPO prices, whether they affect the fluctuations in cooking oil prices, in the sense that one day the CPO price will decrease, it will be followed by a decrease in cooking oil prices," he explained.