19/05/2022 (Korea Joongang Daily) - Korea will not run out of cooking oil, the government vowed, despite worries after Indonesia suspended palm oil exports.
A lower tariff is being considered, but supply should be fine unless panic buying leads to hoarding.
The Ministry of Agriculture, Food and Rural Affairs held a meeting on Wednesday with local cooking oil suppliers including CJ CheilJedang and Lotte Foods to discuss supply chains for cooking oils.
Indonesia, the No. 1 palm oil exporter, banned exports in late April, but domestic cooking oil suppliers can buy palm oil from Malaysia, according to an industry source.
Soybean oil is the main type of cooking oil used in Korea and it is imported from countries like the United States and Argentina. It is also locally produced from imported soybeans.
Imports of cooking oils used in homes such as canola oil and olive oil have no supply problems as of now.
Sunflower oil is an exception because Ukraine was a main supplier before it went to war with Russia. Korea is looking for alternative suppliers such as Spain or Argentina.
Prices may rise, however, because of sharp increase in demand.
“The supply is the same as last year, but the number of orders has increased by two to three times,” said Jeon Han-young, director of the food industry policy team of the Ministry of Agriculture, Food and Rural Affairs.
In particular, orders for 18-liter cans used in restaurants and 1.8-liter bottles used in homes have increased sharply.
Local suppliers said during the meeting they have no plans to increase prices because they increased them last year and early this year.
The government said it is considering eliminating the 5 percent import tariff on soybean oil and sunflower oil temporarily.
Some big discount marts and online shopping malls are limiting the amounts of cooking oil they sell to customers.
“I believe these shops will lift the purchase limit as soon as the panic buying phenomenon cools down,” said Jeon.