Palm oil price up because Indonesia has banned exports, speculates Korn
Kla party leader Korn Chatikavanij speculated that the reason why the price of bottled palm oil has increased so heavily is because Indonesia has banned palm oil exports.
Korn wrote on his Facebook page on Thursday that Indonesia, the world’s biggest palm oil manufacturer and exporter, had banned exports of the oil to keep prices down for its citizens, causing the price elsewhere to increase.
He said it was good news for farmers but not for consumers because the price of consumer products is already high.
Korn pointed out that the palm oil price increased drastically as sunflower oil was in shortage due to Ukraine being forced to halt manufacturing, while Indonesia had stopped exporting palm oil.
According to experts, the cost of bottled palm oil should be 75 baht. It is currently 64 baht.
Korn said manufacturers are able to retain the same price for now because there are still bottles left at earlier prices and they had gained a lot of profit in the past.
If the situation returns to normal quickly, the problem is not worrying, he noted. However, if the situation prolongs or worsens, the government needs to do something to help consumers.
Korn suggested the government use its reserve budget to insure the palm price for farmers is 4 baht per kg. The government could use this budget to compensate citizens to lower their burden, he wrote.
He said it’s not only money but also a question of health because Thais will have to reuse oil if the government allows the price of bottled palm oil to go too high.
“The world situation is always changing quickly. To manage the economy during these times, [the government] must not blink,” he added.
