Indonesia Lifts Ban on Palm Oil Exports
It was only a matter of weeks ago that Indonesia, the largest supplying nation of palm oil in the world, made a shocking announcement that it was banning all exports of the oil as an attempt to shore up domestic supply and reduce prices.
Since the ban was enacted, Indonesia’s palm oil reserves increased threefold to 211,639 metric tons, and prices fell from US$1.35 to US$1.17, not quite making the target price of US$.096 set by the country’s president, Joko Widodo.
With the lifting of the ban, the government has also put in place a domestic market obligation (DMO) stating that 10 million metric tons of cooking oil must stay available in Indonesia at any given time - 8 million for consumption, and another 2 million in reserve.
There is speculation that this move might be the result of international pressure for countries to work together to mitigate a looming food crisis due to the war in Ukraine. The lifting of the ban (effective May 23) was concurrent to the World Economic Forum Davos 2022 summit, and is before a critical G20 meeting being hosted by the country in Bali this November.