In response to rising palm oil prices, driven by reduced production due to drought and crop disease, the government has announced a temporary pause on crude palm oil exports.
The Ministry of Commerce is urging retailers to stabilize prices and run promotions to help ease the burden on consumers. At the same time, they seek to balance farmers’ income from palm fruit with consumer prices for cooking oil.
Pichai Naripthaphan, Minister of Commerce, explained that recent price increases are due to lower palm fruit output, which has affected market availability. The Ministry aims to ensure fair prices for farmers without placing excessive costs on consumers for bottled palm oil. As a short-term measure, Pichai has directed the Department of Internal Trade to consider curbing crude palm oil exports and, if necessary, limiting its use in biodiesel production to redirect more supply toward consumer needs.
The production shortfall, linked to previous droughts and disease, is expected to hit its lowest point between November and December, with palm fruit prices currently ranging from 8-9 baht per kilogram. Production is anticipated to return to normal by January 2025. Currently, bottled palm oil prices range from 43-48 baht per bottle, depending on stock batch timing.
Vendors report that the cost of palm oil has risen sharply. Previously priced at 520 baht per dozen or 43 baht per bag, it has recently surged to 690 baht per dozen or 57 baht per bag. They note that bottled palm oil prices in convenience stores have increased by about one baht per bottle over the past week, now ranging from 46-47 baht depending on the brand. Vendors purchasing palm oil in large tins also face challenges in securing supplies, with prices exceeding 50 baht per bottle in some years.
Despite these cost hikes, vendors have refrained from raising prices further, aiming to keep their products affordable for customers.
Source: NNT
