Jakarta. The government has launched a new cooking oil product with subsidized prices and offered incentives for producers who agree to join the program, Trade Minister Zulkifli Hasan said on Wednesday.
Called Minyakita, the new product will be sold in simple packaging at only Rp 14,000 ($1) a liter.
Producers who help the government in the production and distribution of Minyakita will be allowed to sell crude palm oil to overseas markets at a volume 20 percent more than their contribution to the program.
For instance, a producer who supplies 7,000 tons of edible oil to Minyakita is allowed to sell 8,400 tons of CPO to the export markets, Zulkifli said.
The government earlier banned CPO exports in the wake of serious edible oil shortage in the country that becomes the world’s largest CPO producer, although the decision was reversed after several weeks.
In an attempt to reduce production costs, the government also supplied cooking oil in unpacked cargo but it caused distribution problems primarily in remote areas.
“We are trying to overcome distribution issue through this simple packaging system and hopefully edible oil can be distributed smoothly, especially in areas where it’s very difficult to get to,” Zulkifli said at his office in Jakarta.
“With Minyakita, we are optimistic that people will get access to the supplies of cooking oil under the ceiling retail price,” he added.
The government has registered Minyakita as a trade mark but it encourages private companies to participate, according to Syailendra, the director general of domestic trade with the Trade Ministry.
The collaboration applies for four years and can be extended if necessary.
"So far Minyakita has received the support from two companies, but seven more will join us for the packaging of this cooking oil for the people,” Syailendra said.
“The new program is expected to speed up cooking oil distribution primarily in the eastern part of the country where it’s very difficult to distribute cooking oil in bulk cargo," he added.