On Friday, Indonesia, the world’s biggest producer of palm oil, revealed plans to limit exports of the most frequently used vegetable oil, in a surprise decision that might exacerbate global food inflation.
The suspension of shipments of the cooking oil and its raw material, which are widely used in products ranging from cakes to cosmetics, might hike costs for packaged food makers around the world, forcing governments to choose between utilising vegetable oils in food and using biofuel. More than half of the world’s palm oil comes from Indonesia.
Indonesian President Joko Widodo said in a video that he wants to assure the supply of food supplies at home after global food inflation hit a new high following Russia’s invasion of Ukraine, a key grain producer.
‘I will monitor and analyse the execution of this policy to ensure that cooking oil is abundant and affordable in the home market,’ he said.
According to Atul Chaturvedi, president of the Solvent Extractors Association of India, the move will harm consumers in top buyer India and around the world (SEA).
‘This is a sad and completely unexpected decision,’ he remarked.
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