Minister vows to tackle high palm oil prices

Minister vows to tackle high palm oil prices

Commerce Minister Jurin Laksanawisit has pledged to tackle high palm oil prices this week after cooking oil prices jumped to nearly 70 baht per bottle from 56-60 baht at the end of last year.

Speaking after chairing a war room yesterday to supervise ongoing increases in essential consumer goods prices including cooking palm oil, Mr Jurin said the sharp rise in cooking oil prices stems largely from fresh palm nuts and crude palm oil prices.

Prices of fresh palm nuts have increased over the past five years from only 2 baht per kilogramme in 2017 to 10-11 baht now.

Mr Jurin acknowledged higher prices benefit farmers, but also affect consumers.

"I've already ordered the Internal Trade Department and the war rooms to find the best solutions and ensure a balance for all stakeholders, be it farmers, manufacturers or consumers," he said.

"Nonetheless, the government is unlikely to intervene in the market and put cooking palm oil on the state price control list."

According to Wattanasak Sur-iam, director-general of the Internal Trade Department, the prices of bottled cooking palm oil sold at department stores, retail and wholesale outlets are still maintained at the price ranges the department has asked for cooperation to cap their cooking oil palm prices.

He forecast the price situation would improve after fresh palm output starts being released into the market next month.

The department reported at the end of December last year, Thailand had crude palm oil stocks of only about 170,000 tonnes -- which is considered significantly low compared to the 300,000 tonnes the country needs to reserve for safety stocks.

The crude palm oil prices are now quoted at 56 baht per kg, up from 35 baht in January last year.

Domestic crude oil prices are 12-13 baht per kg more expensive than the world market price now quoted at 44 baht, even though Thailand is a major grower of oil palm nuts.

The Agricultural Economics Office forecast the supply of fresh oil palm nuts will be around 17 million tonnes this year, up from 16 million tonnes last year.

Domestic demand is expected to be close to domestic supply. Of the total supply, about 1 million tonnes will go towards edible oil production and the rest for biodiesel and for safety stocks.

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