Bulog role in cooking oil distribution comes to an end

Bulog role in cooking oil distribution comes to an end

JAKARTA (JP): The government removed yesterday the
distribution role of the State Logistics Agency (Bulog) for
domestic cooking oil.

Minister of Trade and Industry Rahardi Ramelan said that with
the new scheme, effective today, the state joint marketing office
(KPB) would buy all cooking oil from the Association of
Indonesian Edible Oil Industries (AIMMI) and sell it directly to
market retail cooperatives (Inkoppas) in the city at Rp 3,500 per
kilogram.

The cooperatives would then sell cooking oil at city markets
at a maximum price of Rp 4,000 per kilogram.

KPB's head Asep Tojib said Jakarta's cooking oil supply
currently stood at 22,520 tons. The amount is sufficient for 35
days' supply at 600,00 tons per day.

Previously, KPB and plantation firms had to sell their crude
palm oil to Bulog, which then distributed it to several appointed
refineries to be processed into cooking oil. The refineries had
to sell back their cooking oil products to Bulog, which then
distributed it to the domestic market.

Bulog has long been criticized for inefficiency and
untransparent practices in distributing cooking oil in the
country.

On Feb. 1, the agency lost its monopolies to import and
distribute several important commodities under an economic reform
program agreed with the International Monetary Fund (IMF). It
still controls the market for rice.

Rahardi said the current scheme was just a temporary scheme
and was only in force until the government came up with a better
scheme which was more efficient and transparent.

Rahardi said the current scheme would come into effect only in
Jakarta due to reports of a scarcity of cooking oil in the city's
markets which has resulted in skyrocketing prices.

"Besides, bad distribution in Jakarta would affect cooking oil
distribution in other cities," he added.

He said the next scheme -- being prepared by the ministry in
cooperation with the Ministry of Forestry and Plantations, and
state minister of the empowerment of state enterprises, cooking
oil producers and traders -- was expected to be ready in two
weeks.

The next scheme will ensure an adequate domestic supply of
cooking oil with more transparency, Rahardi said.

Meanwhile, Inkoppas president H. Wirman said cooperatives
would punish retailers found guilty of selling cooking oil above
Rp 4,000 a kilo by cutting off their cooking oil supply. (gis)