Businessman Answers Alleged Cartel Behind 'Exorbitant' Cooking Oil Prices

Executive Director of the Association of Indonesian Vegetable Oil Industries (GIMNI) Sahat Sinaga stated that the businessmen had actually communicated with the KPPU regarding the reason for the increase in cooking oil prices on January 18 last.

According to him, GIMNI has followed the price reference set by the tender for PT Perkebunan Nusantara (PTPN) through its subsidiary PT Kharisma Marketing Bersama Nusantara (KPBN). The KPBN reference tender is used because the company is considered a neutral party that does not do business in the downstream sector and is a state-owned company. Therefore, he claims that entrepreneurs do not have the ability to regulate the price of cooking oil. "GIMNI has already provided an illustration of who makes up the domestic palm oil price. So, all domestic companies whose palm prices always adhere to the tender conducted by PT KPBN," he told CNNIndonesia.com, Friday (21/1). He gave an example as of today, Friday (21/1), KPB in Dumai, Riau, set the CPO auction price at the level of Rp. 15,200 per kilogram. With the benchmark price of CPO above the HET of cooking oil, it is not surprising that the price of cooking oil in the community has soared. "Now, try asking PTPN whether they want to sell for Rp. 11 thousand? The world market price is Rp. 15 thousand, the price is lowered for domestic use, right, they don't want to make a profit, right," said Sahat. Even though Indonesia is the largest producer of CPO, the fact is that Indonesia is a price leader. Of Indonesia's total production, only 35 percent can be absorbed by domestic consumption. Since the majority of production is still exported to international markets, he said that even the benchmark price inevitably follows foreign markets, such as the Rotterdam reference. Sahat also questioned the reason behind KPPU's hype when CPO prices soared. The reason is, he assessed that when the price of CPO was falling and oil palm farmers screamed, no intervention was carried out.

|•SOURCE•| Articles :CNN | Image :VOI |

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