Govt to maintain ban on CPO exports: Tunky

JAKARTA (JP): The government stressed again yesterday that it would maintain its export ban on crude palm oil (CPO) and all its derivatives except stearin and palm kernel oil to secure the supply of cooking oil to the domestic market.

Outgoing Minister of Industry and Trade Tunky Ariwibowo said the export ban would only be lifted if the local supply of cooking oil returned to normal.

The ban affects exports of CPO, refined bleached deodorized palm oil, crude olein and refined bleached deodorized olein.

Last month, the government lifted its ban on the export of stearin and palm kernel oil.

"If the price stabilizes and there is a guarantee that the supply for domestic needs is sufficient, we would consider allowing exports again," he said following a meeting with President Soeharto.

Tunky also revoked his previous decree -- issued on Dec. 17 -- which established a 20 percent quota on the export of palm oil and olein and imposed a 28 percent to 30 percent surcharge tax on exports which exceeded the quota.

Last December the government banned the export of CPO, olein and other CPO derivatives until March to ensure an adequate domestic supply of cooking oil and to stabilize the price.

The measure failed to stop cooking oil prices soaring and food stores have run short.

CPO producers are reportedly withholding their products to gain from sales overseas when exports are allowed again, while many retailers are stockpiling cooking oil for when prices go up after the export ban is lifted.

The price of spot CPO in Europe has risen from US$557.50 per ton before the ban -- which became effective on Jan. 1 -- to $680 per ton at present while olein has gone from $572.50 to $652.50 per ton.

According to the Ministry of Industry and Trade, cooking oil supply from January to April is expected to reach 923,023 tons, comprising 863,023 tons from CPO production and 60,000 tons from coconut oil.

The domestic consumption of cooking oil for the same period is estimated to be 611,746 tons.

Indonesia is the world's second largest producer of CPO after Malaysia with total supply this year projected to reach 5.9 million tons. Local annual demand is usually about 3.5 million tons.

Outgoing Minister of Agriculture Sjarifudin Baharsjah said yesterday that the state-owned plantation firm PT Perkebunan Nusantara would supply 58,000 tons of olein to the domestic market in April.

Sjarifudin said after meeting President Soeharto that PTPN's CPO production in April was estimated at about 133,000 tons which is equivalent to more than 63,000 tons of olein.

He said that PTPN's olein would be released to the domestic market if the price of cooking oil continued to increase.

Last month, the minister said that PTPN would sell about 100,000 tons of CPO per month, virtually 100 percent of its production.

PTPN at present produces about 1.8 million tons of CPO a year which is enough to make about 1.5 million tons of olein. Olein accounts for 70 percent of all CPO products. (gis/prb)