ISLAMABAD: Pakistan has been left with a palm oil stock for nearly 20 days, and unless Indonesia withdraws the ban on its exports, it’s a critical stage ahead of a crisis that will push further vegetable oil prices in the domestic market to a new high, official and industry sources told Dawn on Monday.
Indonesia suspended exports of palm oil on April 28 to cater to domestic oil prices. However, Malaysia, another supplier of palm oil, is still exporting, which has the lowest ratio in the supply of palm oil to the world market.
In Pakistan, vegetable ghee has already crossed Rs500 a kg. “This price will go up further in the event of no resumption in supply,” the official said. The depreciation of the rupee is adding to the price of ghee and cooking oil as well.
Palm oil stocks deplete as no imports made after export ban by Indonesia
The imposition of a ban on the export of palm oil by Indonesia has created uncertainty in the palm oil market, with prices showing an upward trend. India has reduced duties and taxes on the import of palm oil in the wake of an increase in palm oil prices in the international market, while Pakistan has not yet reduced duties and taxes to give relief to the masses.
Prime Minister Shehbaz Sharif has already constituted a task force under the commerce minister to look into issues and ensure the supply of palm oil to local manufacturers of vegetable ghee. Two meetings of the task force have been held so far.
Sheikh Abdul Waheed, ex-Chairman of the Pakistan Vanaspati Manufacturers Association (PVMA), told Dawn that palm oil stocks are fast depleting in the country. “We have 20 to 25 days of stock,” he said, adding things could get worse if supply is not resumed in the next 20 days.
He said that no purchases had been made in the past few weeks.
On May 9, Pakistan had a stock of 325,500 tonnes. This includes 174,500 tonnes of RBD palm olein, 118,500 tonnes of RBD palm oil, besides seeds like CDSBO 27,500 tonnes, canola oil, 2,000 tonnes and sunflower oil, 3,000 tonnes used in the cooking oil.
Published in Dawn, May 17th, 2022