KOMPAS.com – Chairperson of the Indonesian Consumers Foundation (UPPER), Sincere Eternal, can’t stop thinking about the skyrocketing cooking oil price in the world’s largest palm oil producing country.
He said, cooking oil is a derivative product of palm oil (CPO) which is a domestic product. But oddly enough, it is sold to the domestic community at a global price benchmark.
“We are the largest CPO producer, we are exporters not importers, so we can determine the domestic CPO price. Not the international price for the national one,” Tulus said in a short message quoted on Thursday (1/13/2022).
Selling cooking oil at a high price in the country would injure consumers. Given the truth, large companies also plant their oil palm on state land through a Hak Guna Usaha (HGU) scheme.
State land granted to private palm oil entrepreneurs through HGU itself is a manifestation of Article 33 of the 1945 Constitution, in which the earth and all natural resources in it must be used for the prosperity of the community.
On the other hand, the government also helps palm oil entrepreneurs a lot by helping to buy CPO for biodiesel needs. The government even helps private palm oil entrepreneurs by disbursing large biodiesel subsidies through the Palm Oil Plantation Fund Management Agency (BPDPKS).
When world palm oil prices rise, big players in cooking oil producers should not sell their products at high prices that burden the community.
The question of price increases due to the number of cooking oil factories that are not integrated or do not have palm oil plantations also does not make sense.
This is because almost all major players in cooking oil producers also control oil palm plantations. Cooking oil produced by big players also jumped.
“I suspect there is a practice kartel or oligopoly. In the Law on the Prohibition of Monopolistic Practices and Unfair Business Competition,” Tulus said.
Kartel itself refers to a group of producers who dominate the market who cooperate with each other to increase profits as much as possible by increasing prices, so that in the end consumers are the losers.
Citing the page of the National Strategic Food Information Center (PIHPS), the price of cooking oil per kilogram is sold in the range of Rp. 19,000 to Rp. 24,000.
In Gorontalo, the price of cooking oil has even exceeded Rp 26,450 per kilogram. Whereas before soaring, the price of this vegetable oil was around Rp. 11,000 to Rp. 13,000 depending on the packaging.
Meanwhile, on a national average, the price of cooking oil in Indonesia is Rp 20,900 per kilogram of branded packaged cooking oil.
This national average price is still more expensive than Malaysia, a neighboring country which is also the world’s largest palm oil producer and has a per capita income 3 times higher than Indonesia.
The cooking oil cartel case in 2009
Allegations of cartels in oil are not new in Indonesia. Quoted from Kontan’s report on June 4, 2009, the Business Competition Supervisory Commission (KPPU) suspects the practice of cooking oil cartels in the Indonesian market.
At that time, KPPU’s Director of Communications, Ahmad Junaidi, emphasized that KPPU was now starting to investigate and was collecting data to prove his suspicions.
KPPU deserves to suspect that there is a cartel. This is because the price of local cooking oil is difficult to come down and seems unrelated to the price of palm oil which is the main raw material.
“We continue to monitor,” said Junaidi at the time.
Since last May, the price of bulk cooking oil in the market has remained in the range of Rp. 10,000 per kilogram. The Business Competition Supervisory Commission or KPPU suspects that there is a cartel by eight companies.
The big companies are Bukit Kapur Mutual Group, Musimmas Group, Sinarmas Group, Sungai Budi Group, PT Perkebunan Nusantara (PTPN) I to IV, Berlian Eka Sakti, Raja Garuda Mas, and Salim Group.
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