Saturday, July 2, 2022

Reprieve as cooking oil prices expected to come down in a week’s time

This is a welcome relief to many Kenyan households, that have been opting for roasted or boiled meals after the manufacturers of cooking oil raised retail prices by at least 35 percent sighting high importation costs.

This follows plans by Indonesia, the world’s biggest supplier of palm oil, to lift its three-week-long palm oil export on Monday 23rd of May.

Kenya mainly imports vegetable oils such as sunflower oils, soybean, corn oil, and crude palm oil from Malaysia and Indonesia, but debilitated production over the last six months in Malaysia due to floods and labor shortages has seen Kenya resort to Indonesia’s palm oil.

The Russian invasion of Ukraine, fueled the shortage since Ukraine, which accounts for 76 percent of global sunflower oil exports, has significantly cut down supplies. Palm oil comprises a third of the world’s vegetable oil market, with Indonesia accounting for about 60% of the supply.

The world’s top palm oil exporter on April 28th, 2022 halted shipments of crude palm oil and some derivative products to try to tame soaring prices of domestic cooking oil.

The ban, was one of the biggest acts of crop protectionism since Russia’s invasion of Ukraine in February and it stymied exports of sunflower oil and worsened a global shortage.

Rising cooking gas, cooking oil prices push inflation to 7-month high

Reports had suggested that despite the tough policies that have rattled edible oil markets and cost hundreds of millions of dollars in lost revenue, the price of cooking oil, a staple for Indonesian families, has not come down, hitting the approval rating of Indonesia’s President Joko Widodo.

Palm oil is an essential commodity used in almost everything from food to soap to fuel, and the earlier move by Indonesia threatened to push up costs even more across multiple supply chains.

Locally the ban saw local cooking oil prices increase, as manufacturers of cooking oil raised retail prices of cooking oil by 35 percent. A 10 liter of cooking oil retails at an average of Kshs. 2,900 in most retail outlets, up from Kshs 1800 a year ago, while a liter fetches Kshs 350.

Kenyans had taken to social media platforms including Twitter and Facebook under the slogan “ lower food prices” to compel the government to intervene in the runaway cost of basic commodities cooking oil included.

The lift of the ban on palm oil exports by Indonesia is a welcome relief as prices are expected to go down in the next few weeks.

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