Cooking Oil Chaos: Government Doesn't Respond Quickly, Prices Will Continue To Rise

People queue for bulk cooking oil. (Photo: ANTARA)

JAKARTA - Although the government has subsidized cooking oil prices and set the highest retail price, for the last two weeks the issue of cooking oil has not subsided. The government must supervise the trade system so that the stock and distribution of cooking oil is more targeted.

The price of bulk cooking oil as of December 24, 2021, will be IDR 17.800 per liter. Likewise, the price of simple packaged cooking oil rose to IDR 18.400 per liter and premium packaged cooking oil to IDR 20.000 per liter. These prices are above the highest retail price set by the government, which is IDR 11.000 per liter.

According to the Food and Agriculture Organization (FAO), the trend of rising prices is influenced by four factors, namely: the impact of the COVID-19 pandemic (reduced labor and production), the La Nina phenomenon that triggers weather anomalies, shipping costs, and surges in demand from importing countries. In addition, the upward trend in world food prices and commodity prices, including CPO, also triggered.

Simple packaged cooking oil, will it last at Rp13,500? (Photo: ANTARA)

Since early November 2021, content about cooking oil has become hot news in the mass media and social media. The price that continues to soar has sparked a conversation about cooking oil.

In the Google search engine and social media during the last two weeks (January 17-23 and January 24-30, 2022), netizens' activities were observed highlighting the government's policy of lowering cooking oil prices.

On January 19, 2022, the Google search engine became the pinnacle of searching for information about cooking oil, at the moment when the cooking oil price was set at IDR 14.000 per liter. At that time information emerged, the government began to implement a one-price policy for cooking oil. Cooking oil price of IDR 14.000 and panic buying are the two keywords in Google Trends.

Female Dominated

Through the Talkwalker application, during the same period recorded, on January 19, 2022, cooking oil content was widely discussed on social media, namely conversations about subsidies and the one-price cooking oil policy.

The conversation during January 17-23 2022 has received 274.000 interactions (engagements) from citizens.

The dominance of women is also seen in the issue of cooking oil content, which can be seen from the demographic profile that appears, which is 52 percent, while that of men is 48 percent. Compared to previous issues such as Omicron, the Russian conflict, the Tonga tsunami disaster, and the arrest of musician Ardhito Pramono.

The closeness of women to this issue is because cooking oil is one of the most important staple commodities for Indonesian people, especially mothers.

Minister of Trade Muhammad Lutfi was accused of being the source of the cooking oil chaos, after admitting that he was unable to control the cooking oil mafia. (Photo: ANTARA/Muhammad Adimaja)

The hashtag #Subsidy for Fried Oil for Who is the most followed conversation on social media. It is the most interactive content conversation about cooking oil in the January17-23, 2022 period.

The government's policy of providing cooking oil subsidies is able to "cool down" the number of conversations about cooking oil on social media. Despite the spotlight on the appropriateness of the subsidy and the limited amount of cooking oil sold in modern retail.

If previously in the January 17-23 period there were 54.700 search content about cooking oil on social media, on January 24-30, 2022 the number decreased to 42.500 content. The government's policy of imposing the highest retail price (HET) also makes the dynamics of the conversation shift from the focus on the accuracy of targeting subsidies.

Minister of Trade Muhammad Lutfi, on January 27, 2022, announced that the government set the HET for bulk cooking oil at IDR 11.500 per liter, simple packaged cooking oil at IDR 13.500 per liter, and premium packaged cooking oil at IDR 14.000 per liter.

Unbalanced Stock

However, this policy has not been balanced with the availability of cooking oil stocks and uneven distribution. Which has an effect on conversations with negative sentiments to the government which will continue in the following week (January 24-30, 2022).

The topic that initially became the focus of netizens regarding the inaccuracy of the target for cooking oil subsidies has now changed, the conversation on social media has turned into four topics, namely unstable cooking oil stocks, the impact of the policy on the obligation to fulfill domestic market needs (DMO), higher world CPO prices. determined by Malaysia as well as the cooking oil business cartel.

It can be seen that the volatility of cooking oil prices will continue to follow the community in the coming days, as can be seen from the four top conversations that resulted in 60.000 interactions. This concern has been raised for various reasons, including news of the oil cartel from newspaper.tempo.co, which has received a lot of interaction on Facebook and Twitter.

Rows of premium packaged cooking oil in modern retail where purchases are limited. (Photo: ANTARA)

Behind the current turmoil, usually cooking oil will increase ahead of the momentum for holidays or national holidays.

The increase in world CPO prices and the lack of supervision of the cooking oil distribution chain have resulted in an increase in the price of cooking oil in the market. Seeing this public unrest, the government should provide guarantees for the stock and distribution of cooking oil.

The government must continue to monitor to support the strategy of setting the highest retail price. Without stock availability and uneven distribution to all corners of Indonesia, it is guaranteed that the issue of cooking oil will continue to haunt the public.