Indonesia to put restrictions on palm oil exports from Jan 1

Indonesia on the dawn of friday announced that they will tighten the policies regarding palm oil exports in order to ensure that there is sufficient supply back home. The country announced that they will tighten the policies from Jan 1 2023 

The island country through a public announcement has said that they will be restricting exports of palm oil in order to maintain an adequate supply for the nation. They have further added that they will be allowing less shipments overseas for every tonne sold domestically. This move have been taken to ensure that the prices of palm oil do not soar in the country 

The new regulations which will come into effect from Jan 1 contain that the exports will be allowed to ship six times their domestic sales volume, less the current ratio of eight times.

Septian Hario, a senior official at the coordinating ministry of maritime and investment affairs, explained that in order to secure domestic supply, especially for the first quarter of 2023 they have taken this decision. He further added that the ratio will be evaluated timely by considering the domestic situation, including cooking oil availability back in Indonesia. 

This move also has been taken by keeping in mind that Indonesia is the world’s most populous Muslim nation and they will be celebrating Ramadan in march 2023 when the demand for food including cooking will typically rise and a scarce supply of cooking oil will be disastrous at such a delicate time. 

Indonesia has been battling to keep cooking oil prices low through the entire year.They has introduced export measures on palm oil products with different success ratios to try to ensure supply and bring the price down.A short ban in the export of edible oil from indonesia sent jitters in the world markets as indonesia is the world largest palm oil exporter. It further worsen the existing global supply by banning the exports. However it led to an increased supply in the Indonesian domestic markets.

Eddy Martono,The general secretary of Indonesian palm oil association(GAPKI) in a meeting with the Government last week have said that there are still concerns regarding cooking oil supply, related to the governments biodiesel programme and expectations of lower palm oil output in the first quarter. Indonesia  is planning to increase the mandatory palm oil component to 35 % starting from feb 1     

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