The Ministry Of Trade Will Lower The DMO Target For Cooking Oil Starting May 1, 2023

JAKARTA - The Ministry of Trade (Kemendag) will reduce the target of domestic market obligation (DMO) for the people's cooking oil program.

Head of the Trade Policy Agency of the Ministry of Trade Kasan Muhri explained that the previously set target of 450,000 tons per month will be lowered to 300,000 tons per month.

Furthermore, Kasan said that the policy related to the DMO of Cooking Oil will take effect from May 1, 2023.

"Back to 300,000 tons per month based on installed capacity in accordance with the Decree of the Director General of Domestic Trade Number 82 of 2022 and will take effect from May 2023," he said in a virtual press conference, Thursday, April 27.

Kasan said, the consideration of lowering the DMO target was taken after seeing the condition of packaged and premium cooking oil during Ramadan and Eid al-Fitr. This includes considering the price of fresh fruit bunches (FFB) palm which is relatively stable at the level of Rp. 2,000 per kg.

Not only that, said Kasan, this policy also takes into account export rights and keeps the supply of DMO stable.

Kasan said the Ministry of Trade would also reduce the export volume ratio of crude palm oil (CPO) and its derivative products to 1:4 from 1:6 previously.

Furthermore, Kasan said that although it reduced the ratio of CPO export collectors, the DMO policy also increased the incentives for export collectors of cooking oil for pillow packaging from 2 to 1.7.

"And 2.25 for packaging other than pillows, for example there are standing vouchers and bottles," he explained.