JAKARTA Minister of Finance (Menkeu) Sri Mulyani said that the global economic condition was still filled with uncertainty. According to him, the current situation is still overshadowed by high inflation and the recovery of a large number of the world's economies.
It was stated that one of the effects of the rambatan that occurred was the soaring price of food commodities, including crude palm oil (CPO). The Minister of Finance found that the CPO price pattern in the future was in the curve of increase along with the disruption of the world supply chain due to war in Ukraine.
The price of CPO, which in 2022 touched 1,733 US dollars per ton, has now contracted to 864 US dollars per ton. But we see that in July there was a trend of price increases because there was an incident in Ukraine," he said online, Monday, July 31.
The Minister of Finance explained that the two countries involved in the war in Eastern Europe are large producers of vegetable oils originating from grains. As a result, the supply of vegetable oil to the world has become disrupted which makes the price of CPO appreciated.
Ukraine and Russia because of war, the distribution became disrupted. This is what makes our CPO also affected (the impact). This also explains why there was a cooking oil crisis in early 2022 (due to high world demand)," he said.
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The Minister of Finance added that another important indication occurred this month which was driven by Russia's stance on trade deals in the region.
In July Russia terminated the agreement for distribution in the Black Lauh which is the traffic of commodity trading. To this day Russia has not renewed an agreement to allow (traffic in the Black Sea). This means that the second half of 2023 will be affected by uncertainty from commodities, almost similar in 2022," he said.
"In addition, there will also be challenges from El Nino's (natural phenomenon), this is something we must be aware of," he stressed.
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