Palm oil export crisis
Palm oil is one of the main vegetable oils present in our daily lives and is taken from tropical environments such as African and Asian countries. The product is very versatile and used for various purposes such as food products, beauty products, and is also present in biodiesel.
Ukraine War Changes Palm Oil Situation
According to the Observatory of Economic Complexity, the Indonesia is responsible for 52% of all palm oil exported in the world, and due to the aftermath of the Ukraine war, the prices of cooking oil and sunflower oil have dramatically increased across the world and also in Indonesia. To control the price of cooking oil within Indonesia and curb the shortage of the product, President Joko Widodo banned the export of palm oil so that it could be marketed in greater quantities within the country at affordable prices to the population.
Indonesian president's action angers local farmers
However, farmers spoke out against the action, as their profits come, in large part, from exporting the product. After 3 weeks of suspension, the export ban will be revoked with some caveats including an export license that must be acquired by producers in order to monitor the amount of oil leaving the country and requiring a certain amount to remain for domestic marketing.
Watch out for new Widodo actions to come
The Indonesian government is still looking for new solutions to deal with oil prices and supplies. At a time like this, when the war in Ukraine directly affects the supply of oil, the concern of other countries, especially with biodiesel, keeps everyone aware of Widodo's next actions and the movements that may be caused in the world market.
By Rafaela Aguiar on 05/25/2022