Under an announcement made last week, Indonesia will limit palm oil exports. However, later this week, the country clarified that the export would only apply to refined palm oil rather than crude palm oil–palm olein. Here’s what you need to know about the ban and details about it:
Why Indonesia banned the export of palm oil?
Last week, Indonesia announced the ban on palm oil exports with an effective date of April 28. The country is the world’s largest palm oil producer, and prices have spiked due to recent droughts and the Russian-Ukrainian war. Palm oil and soy oils are fueling a significant supply deficit as Russia has imposed export restrictions on Ukraine.
What is the amount of palm oil imported into India?
In terms of palm oil imports, India is the world’s largest importer. Every year, approximately 13.5 million tonnes of edible oil are imported to India. 8-8.5 million tonnes (about 63 per cent) are imported from Indonesia, while nearly 45 per cent are imported from Malaysia. Approximately 4 million tonnes of palm oil are imported from Indonesia each year.
Brief Recap on how palm oil is used.
With the increasing demand for fats and oils, the prices of palm oil derivatives have risen. This has increased the input costs of industries that rely on these oils like food products, detergents and cosmetics.
What you need to know about India’s recent palm oil announcement.
Last year, the government launched a new program to invest in edible oil to see domestic production levels increase by three times to reach one million tons by 2025-26. The program aims to bolster domestic supply and lower import costs from palm oil imports.
Among the key attributes of the NMEO-Oil palm is assistance for planting material; inputs for intercropping from 4 years gestation to maturity; maintenance structures including seed gardens, nurseries, bore wells, irrigation structures and vermicompost; solar pumps for harvesting equipment, training centres for farmers and officers, and replanting old field plots.