Cooking Oil Prices Skyrocket, Trade Minister Lutfi's Subordinates Admit That The Government Took The Wrong Policy

JAKARTA - The government through the Ministry of Trade (Kemendag) admits mistakes related to policies that have caused domestic cooking oil prices to skyrocket since late 2021. The mistake in question is to let cooking oil depend on international crude palm oil or CPO prices.

The Director-General of Domestic Trade at the Ministry of Trade, Oke Nurwan, said that the current increase in cooking oil prices was an anomaly, due to the COVID-19 pandemic and due to the disruption in the supply of vegetable oil in the world.

But apart from that, Oke admits that the government sees that there is something wrong regarding the policy that is too detached from the trading mechanism related to cooking oil.

"The government sees that at the current position, something is not right. We admit that we have too released the price of cooking oil to the trade mechanism, the government's intervention in which the domestic cooking oil price is left dependent on international CPO prices," he said in a virtual discussion, Thursday, February 3rd.

Therefore, according to Oke, the main cause that must be corrected is related to the skyrocketing cooking oil price, not improving the system from upstream to downstream which has been fine for a long time. However, breaking away from dependence on international CPO prices.

"The main reason that must be corrected is to free domestic cooking oil from dependence on international CPO prices. That is the most important thing," he said.

Oke said that the effort to break away from dependence on international CPO prices was carried out in the Dometic Market Obligation (DMO) and Dometic Price Obligation (DPO) policies.

"If it doesn't work, I'll also issue another form of policy, which I can't mention here. I've prepared various steps that we really have to take," he said.

Furthermore, Oke also emphasized that the government cannot wait to suppress high cooking oil prices, if it has to fix the system from upstream to downstream or findings regarding the alleged cartel in the cooking oil industry.

"I can't wait to clean up first from upstream to downstream because women can't wait. Can't blame someone on the cartel, because the case must go to law, there must be a court decision and so on, you can't want it tomorrow," he said.