Bulog to buy 29,000 tons of palm olein
Bulog to buy 29,000 tons of palm olein
JAKARTA (JP): The State Logistics Agency (Bulog) has opened a
tender to buy 29,000 metric tons of palm olein from private
domestic producers at international market prices, the agency's
chairman Beddu Amang said yesterday.
Beddu said the agency would also buy another 60,000 tons of
palm olein from state plantation companies this month in a bid
stabilize prices of the cooking oil on the domestic market.
"The price of the olein will range between Rp 5,000 (36 U.S.
cents) and Rp 5,300 per kilogram," Beddu said after a ceremony
for the handover of rice from Thailand.
Bulog was given back its exclusive right to distribute cooking
oil on the domestic market last week, replacing the previous
distributors, state-owned trading companies PT Dharma Niaga and
PT Pantja Niaga.
Beddu said Bulog would sell the olein, the cooking oil made
from crude palm oil (CPO) -- to traditional markets through
cooperatives at a maximum price of between Rp 3,900 and Rp 4,000
per kilogram.
The price differential between Bulog's purchasing price from
the private and state companies and the retail price would be
made up by a government subsidy, which would come from export
taxes of crude palm oil (CPO) and its derivatives.
Traders said olein was yesterday quoted at 5,300 rupiah/kg and
5,750 in Medan and Jakarta, respectively.
Early this month, the government raised the export tax of CPO
to 60 percent from 40 percent to discourage producers from
exporting and to cut cooking oil prices at home.
But CPO producers are still preferring to sell their products
overseas despite the high export tax because the sharp
depreciation of the rupiah against U.S. dollar gives them
substantial profits from their exports.
Beddu defended the private CPO producers for preferring to
export their products than to supply local markets at lower
prices.
"The companies are only doing business, they want to export,"
he said.
One way of encouraging companies to sell their products here
instead of exporting them was "by buying the products at market
prices," he said.
"If we only tell them to sell cheaper, they will say yes in
front of us, but not behind us," he said.
Beddu said that if the rupiah strengthened to 10,000 against
the U.S. dollar there would be no needs to subsidize cooking oil.
Thai rice aid
At yesterday's ceremony, which was attended by Thai Ambassador
to Indonesia Somphand Kokilanon, Beddu said Indonesia had
received the first phase of a rice grant from Thailand. Five
thousand tons arrived in Surabaya two months ago.
He said a delegation comprising himself and State Minister of
Food and Horticulture A.M. Saefuddin would visit Thailand next
week to negotiate additional bilateral aid.
Indonesia is expecting 100,000 tons of additional rice in
loans and 400,000 tons in governemt-to-goverment grant from
Thailand, he said.
The government had secured a 50,000-ton grant from Japan and
10,000 tons from Vietnam, he said.
Japan has also pledged to provide 500,000 tons of rice in
loans and cash loans to buy 450,000 tons of rice from a third
country.
Taiwan is providing 200,000 tons of rice in a 10-year loan to
Indonesia.
Beddu said Japan's rice shipment would arrive in September,
while other shipments would reach the country by next February at
the latest.
Current rice stocks are about 2.4 million tons, he said.
Beddu said domestic procurement of rice was about 140,000 tons
currently, but added rice production this year was expected to
reach 250,000 tons. (das)