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Govt removes price cap on cooking oil
Cooking oil prices have climbed to Rp 24,000 per liter, from Rp 14,000 per liter, after the cap was lifted.
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A supermaket displays almost empty shelves for cooking oil in Bekasi, West Java, on Jan. 27, 2022. (JP/Niken Prathivi)
T
he government has revoked the retail price ceiling (HET) for cooking oil to address a three-month long cooking oil shortage across Indonesia.
The Trade Ministry on Wednesday issued Trade Ministerial Regulation No. 11/2022 revoking regulation No. 6/2022 on the HET for simple packaged cooking oil and premium packaged cooking oil. Regulators upheld a price cap for bulk cooking oil at Rp 14,000 (98 US cents) per liter.
“Responding to the President’s direction and current cooking oil shortage, regulation No. 6/2022 was issued on March 16 that is effective immediately,” Trade Minister Muhammad Lutfi said during a hearing with House of Representative Commission VI, overseeing trade, industry and investments, on Thursday.
According to the previous regulation, the HETs for bulk cooking oil, simple packaged cooking oil and premium packaged cooking oil were Rp 11,500, Rp 13,500 and Rp 14,000 per liter, respectively.
The government introduced the price cap to make cooking oil more affordable as the price of crude palm oil (CPO) and olein, the raw material to produce the product, surged in recent months. However, the cap resulted in a shortage as producers opted to export instead, skirting restrictions in the process.
Read also: Govt forces CPO firms to ensure cheap domestic supply
Coordinating Economic Affairs Minister Airlangga Hartarto first announced the new cooking oil policy on Tuesday after a limited internal meeting with President Joko “Jokowi” Widodo.
