Rising Plastic Packaging Prices Threaten to Make Cooking Oil Even More Expensive

Rising Plastic Packaging Prices Threaten to Make Cooking Oil Even More Expensive

• Special Report

Jakarta, VIVA – The rise in the prices of basic necessities is once again drawing public attention, particularly for commodities used daily such as cooking oil. Amid global turbulence due to conflicts in the Middle East, the impacts are starting to be felt in Indonesia’s domestic market, one of which is through the surge in plastic packaging costs that is pushing up cooking oil prices.

This phenomenon demonstrates that the global supply chain has a significant influence on the prices of everyday consumer goods. When fossil fuel prices rise sharply, various derivative products such as plastic are also affected.

This situation then impacts the production costs of the cooking oil industry, especially for packaged products. Executive Director of the Palm Oil Agribusiness Strategic Policy Institute (PASPI), Tungkot Sipayung, explained that the rise in domestic cooking oil prices stems from the conflict in the Middle East between the United States and Israel with Iran, which has triggered a near doubling of global fossil fuel prices.

According to him, the closure of the Strait of Hormuz amid the conflict has disrupted the supply of raw materials and impacted the price increase of fossil fuel derivative products, including plastic. It is this surge in plastic packaging prices that is then driving up domestic cooking oil prices.

“Global fossil fuel prices have increased from around US$60 per barrel before the war to more than US$110 per barrel. As a result, all derivative products from fossil fuels, such as plastic, have experienced rises,” he stated, as quoted from a press release on Thursday, 23 April 2026.

The rise in domestic cooking oil prices due to the plastic price surge will undoubtedly have a significant impact on the public. Indonesia is not only known as the largest palm oil producer but also as the largest consumer of palm cooking oil in the world.

Palm cooking oil is consumed by around 280 million Indonesians. Tungkot explained that there are three types of palm cooking oil consumed by the public domestically: premium packaged palm cooking oil (MGS) with various brands, MGS MinyaKita targeting low-income communities and SMEs, and bulk MGS widely used in the food industry.

Of these three types, the government has direct control over the prices and availability of MGS MinyaKita. Meanwhile, the prices and supply of premium and bulk cooking oil are more determined by market mechanisms.