Community Losses Due To Cooking Oil Crisis Reaches Rp. 3.38 Trillion, Research Institute: This Must Be Ended Because Ramadan Is Coming Soon

Illustration. (Photo: Doc. Antara)

JAKARTA - The Institute for Demographic and Poverty Studies (IDEAS) Research Institute conducted a study on the economic impact of the cooking oil crisis in the country. From the research results, IDEAS estimates that the economic losses borne by the community due to the surge in cooking oil prices will reach Rp. 3.38 trillion.

IDEAS Director Yusuf Wibisono said the loss accumulated from two periods of increase, namely Rp. 0.98 trillion in the period April to September 2021 and Rp. 2.4 trillion in the period from October 2021 to January 19, 2022.

Yusuf explained that the estimation of community losses was obtained by using the average price of cooking oil for the January-March 2021 period as the baseline, where the price of cooking oil was still normal.

"This loss estimate is still conservative, because it does not take into account the post-January 19 2022 period. Even though after January 19, 2022 the price of cooking oil has officially dropped, but the supply of cheap cooking oil is very limited. It's not even available in many places," he said in a written statement. , quoted Monday, March 14.

If during the cooking oil scarcity period that occurred after the policy of the highest retail price (HET) on January 19, 2022, Yusuf said, people tried to maintain their cooking oil consumption by being forced to buy at a price higher than HET, then the community's losses would be even greater.

"The increase in prices and scarcity of cooking oil is very ironic because Indonesia is the largest producer of palm oil in the world. In 2020, the area of oil palm plantations has penetrated 14.5 million hectares with crude palm oil (CPO) production in the range of 45 million tons," said Yusuf.

Yusuf stressed that the cooking oil crisis must end as soon as possible. Because cooking oil is now one of the most important basic needs of the community, especially with the month of Ramadan in sight.

"In 2021, we estimate that national consumption of cooking oil will be in the range of 3.3 billion liters, with the public's annual expenditure on buying cooking oil reaching Rp. 43 trillion, with an average purchase price of around Rp. 13,000 per liter," he explained.

The biggest loss is borne by the middle class

With a significant number, the middle class dominates the national consumption of cooking oil. Expenditure class per capita per month of IDR 1-3 million, which is 40.7 percent of the population, accounts for up to 46.4 percent of national cooking oil consumption.

Yusuf explained that the next largest consumer is the spending class of IDR 400 thousand to IDR 1 million, which is 46.9 percent of the population, contributing 42.2 percent of national cooking oil consumption.

Based on these data, said Yusuf, it is not surprising that the biggest economic loss due to the recent surge in cooking oil prices will be borne by the middle class.

"Household consumers of cooking oil in the class per capita monthly expenditure of Rp. 1 million to Rp. 3 million with daily consumption of 4.23 million liters, bear an economic loss of Rp. 1.57 trillion. The next biggest loss is experienced by consumers in the expenditure class of Rp. 400 thousand to Rp. 1 million with a daily consumption of 3.85 million liters of cooking oil, bearing an economic loss of IDR 1.43 trillion," he explained.

Based on the region, said Yusuf, the biggest economic loss from the cooking oil crisis was experienced by household consumers in Java, with consumption of 5.1 million liters per day, bearing a loss of Rp. 1.99 trillion.

"After Java, the second largest loss was experienced by household consumers in Sumatra with a consumption of 2.5 million liters per day, bearing a loss of IDR 0.85 trillion," he said.

Then, continued Yusuf, consumers in other regions such as Kalimantan, Sulawesi, Bali, Nusa Tenggara, Maluku and Papua, if they consume a total of 1.7 million liters per day, bear a loss of Rp. 0.54 trillion.