The Messy Irony Behind Indonesia’s Move to Ban Palm Oil Exports
- In theory there is way more than enough to meet local demand
- Answer lies in fragmented and poorly located processing plants
A shopkeeper packages cooking oil at Kambing Market in Jakarta, Indonesia on April 26.
Photographer: Dimas Ardian/BloombergThis article is for subscribers only.
Indonesia, which ships about a third of the world’s edible oil cargoes, has just imposed a sweeping ban on palm oil exports to protect its domestic market at a time of rampant global inflation -- one of the most dramatic examples of food protectionism in recent history.
Vegetable oils, used in everything from cooking to candy, lipstick and fuel, have been on a tear after Russia’s invasion of Ukraine stymied exports of sunflower oil, worsening an existing shortage of oils caused by drought and labor woes. The dearth of supply sent demand soaring for Indonesian palm oil -- the world’s most consumed edible oil -- prompting the halt in sales.