Thai Govt 'Can Solve' Palm Oil Crisis: PM Abhisit

[webfact]

Govt 'can solve' palm oil crisis

By The Nation

PM Abhisit says Bt1-billion payment for price freeze cost can be avoided

The government is expected by tomorrow to crack the palm oil crisis without having to spend Bt1 billion to freeze the price, as suggested by the Commerce Ministry.

"I don't think the government needs to spend so much money on the price subsidy," Prime Minister Abhisit Vejjajiva said yesterday.

The palm oil policy committee chaired by Deputy Prime Minister Suthep Thaugsuban, which meets tomorrow, would effectively resolve the shortage of palm oil for cooking, he said. The government has been closely monitoring the supply problem since last year and observed two key factors - soaring global demand and unfavourable weather, which reduced oil palm harvests he said.

After anticipating the shortage, the government gave the green light to import two lots of crude palm oil, he said.

The first lot of 30,000 tonnes has already arrived and been assigned to 10 producers.

"It was found that the [second] order for 120,000 tonnes has not been processed," he said.

Suthep has already been instructed to facilitate the imports of palm oil, he added.

Commerce Minister Porntiva Nakasai defended the delay in the order, saying her ministry and refiners could not agree on the maximum retail price.

The price for a one-litre bottle has been capped at Bt47 while the production cost has surged to Bt41-Bt42, she said.

If the government wants to continue to peg the price, then it has to subsidise about Bt2 a bottle with a total bill of about Bt1 billion, she said.

Without the subsidy, palm oil will likely spike to Bt55-56 per bottle, she said.

The Department of Special Investigation will by Wednesday complete its inquiry into suspected manipulation of production quotas to drive up the price, DSI director-general Tharit Pendit said.

The probe covers the 10 refiners permitted by the Internal Trade Department to produce palm oil at the subsidised price.

Any manufacturers or distributors of palm oil found involved in hoarding will be prosecuted to the fullest extent of the law, he said, adding that the 30,000 tonnes of imported palm oil could not be found in the market.

Pheu Thai Party spokesman Prompong Nopparit said government politicians and businessmen were colluding to create the "artificial" shortage of palm oil.

The DSI should inspect palm oil stocks in Krabi, Surat Thani, Chumphon, Samut Prakan, Samut Sakhon and Samut Songkhram, he said.

Five ships loaded with palm oil were anchored off the coast as if they had an insider's knowledge of pending import orders, he said.

A government figure with the initial "S" was trying to push up the retail price by Bt9 per bottle, he said.

The Thai Oil Palm and Palm Oil Association issued a statement condemning the profiteering campaign.

The supply deficiency should not have happened despite the fact that a new crop of oil palms was entering the market, the statement said.

Even though the Commerce Ministry's Public Warehouse Organisation was slow to execute the import orders, the proposal to allow private importers to supply palm oil would lead to greater market distortion, it said.

The government should allow time for the market to rectify itself, it added.

-- The Nation 2011-02-21

[webfact]

Commerce Minister Denies Corruption in Palm Oil Crisis

The commerce minister has denied being involved in a palm oil hoarding scam, and is calling on the Pheu Thai Party to reveal the names of politicians that it alleged of engaging in fraud.

Commerce Minister Porntiva Nakasai explained that the delay in solving palm oil shortage, saying that the ministry has yet to release seven million bottles of palm oil from the initial 30,000 tons of imports from Malaysia.

She said that the ministry has opened 40 more outlets in department stores and hypermarkets including 15 branches at Tesco Lotus, 13 branches at Big C, 5 branches at Carrefour and 7 branches at Makro, with each selling a daily quota of 4,800 bottles, in order to speed up distribution.

Porntiva added that the ministry has been coordinating with 7-Eleven to sell state-distributed blue-capped bottle palm oil at its outlets, starting.

All of the remaining palm oil imports are expected to be distributed to the outlets by Wednesday.

The minister went on to say that the ministry will continue releasing the initial palm oil imports, while the second import of 120,000 tons is still pending due to concerns over the high price and hoarding attempts to drive the price up.

She said the ministry is negotiating the price with overseas producers so that the palm oil import can be sold at a minimum of 47 baht per bottle.

Meanwhile, the Royal Thai Navy and Customs Department officials are investigating a fleet of freighters near Thai shore, under the suspicion that they may be carrying smuggled palm oil.

Porntiva further stated that the ministry will propose to the national palm oil policy committee at tomorrow's meeting to consider importing purified or bottled palm oil instead of crude palm oil, in order to prevent price collusion and hoarding.

Responding claims by the Pheu Thai Party that two politicians are allegedly involved in a palm oil hoarding scheme, the commerce minister urged the party to give specific names.

She expressed no concern about the recent inspection of palm oil factories by the Department of Special Investigation, and affirmed that major palm oil manufacturers are not hoarding palm oil and suspending their production, as reported by the media.

-- Tan Network 2011-02-21

[webfact]

Govt to Decide on Additional Palm Oil Imports Tomorrow

The Prime Minister says the government expects to reach a conclusion regarding the importation of an additional 120,000 tons of palm oil.

Meanwhile, he has vowed to continue implementing policies that address the rising cost of living.

Prime Minister Abhisit Vejjajiva explained the issues surrounding the palm oil crisis in his weekly television address on Sunday, saying that the rising prices are the result of local shortages and high demand in both the domestic and global markets.

The premier said that 30,000 tons of imported palm oil will be sold at 47 baht per bottle as a stopgap measure.

He added that the government has approved the additional import of 120,000 tons to further alleviate the problem.

Abhisit said that Deputy Prime Minister in charge of national security Suthep Thaugsuban and Deputy Prime Minister for economic affairs Trairong Suwankhiri have been tasked with expediting the second batch of imports.

The National Palm Oil Committee is expected to make a decision on whether to go ahead with the additional imports at tomorrow's meeting.

The prime minister admitted that despite improvements in several economic indicators, especially the huge increase in state revenue, most people are still suffering from rising goods prices.

He said measures will be rolled out continuously in a bid to increase income and reduce expenses for consumers.

Abhisit also thanked House members for their help in passing the mid-year supplementary budget and called for cooperation throughout the process, as the budget will be used in providing aid to senior citizens, the disabled and victims of natural disasters.

He insisted that the budget is transparent, as all projects must show detailed spending plans, and said that any unnecessary expenses will be cut.

-- Tan Network 2011-02-21

[swifty5x5]

How am I going to drive my big diesel without cheap palm oil to make biodeisel and everyone else can subsidize my fuel costs or just starve to death?

[janverbeem]

I understand that there is a shortage of palm oil because it is used in bio diesel.

But as of sudden there seems also to be a shortage of corn to make oil ,no sunflowers are growing anymore,farmers aren't growing rice anymore to make rice bran oil and the coconuts are also very rare because last time I looked the coconut oil was over 600 Baht a liter .

I do smell something but it isn't the smell of affordable oil for sure.

[sprq]

Ban palm oil, whose rapidly expanding plantations are the main cause of deforestation in Southeast Asia, especially in Indonesia.

Avoid using palm oil; inspect all food labels for palm oil content and do not buy food containing it.

Save the planet, and not your own money through using cheap and nasty oil.

[sevenhills]

I understand that there is a shortage of palm oil because it is used in bio diesel.

But as of sudden there seems also to be a shortage of corn to make oil ,no sunflowers are growing anymore,farmers aren't growing rice anymore to make rice bran oil and the coconuts are also very rare because last time I looked the coconut oil was over 600 Baht a liter .

I do smell something but it isn't the smell of affordable oil for sure.

Jan / Swifty.

The issue that has arisen here in Thailand re shortage of Palm oil (not only here or only this type of crop) has been of concern to me and many others for some time, as originally the idea of bio fuels (as like wind power and solar panels) looked idealistic early on, but now as with other countries in the World hell bent on these looney green ideas of Bio fuels, ugly wind turbines. and solar panels dotted all over the country side. The World will run out of staple food in the not too distant future if they continue along this path. As you mentioned...where are the sunflowers and Corn going to?....BIO FUELS. Lunacy that is driven by the UN, IPPC, Gore et al, Man made global warming alarmists bull sh.t. (and the lot of them should be in jail for FRAUD......The science is not settled.

There, I've had my rant for the day, hope u all have a good one.

[Sydebolle]

...... do I smell a rat?

[anterian]

Coconut oil and palm fruit oil, are plant-based sources of saturated fats. I avoid them, my choice in order of preference is corn oil, sunflower oil, rape seed oil, canola is excellent but is rarely available as a cooking oil. Olive oil is also excellent but expensive for use as a normal cooking oil.

[recycler]

Every square meter of land can be used only once, either to produce food or to produce fuel. We have enough problems in the near future feeding all the people.

Bio-fuel is a very bad idea, it's stealing by the rich from the poor to support unwillingness to reduce the energy consumption. Bio-fuel is creating food shortage, souring prices of basic needs and more slave jobs in poor countries. Look at all the people that work on palm oil, sugar cane and other plantations in Thailand only. They earn 100 Baht a day or less under extremely bad labor and housing conditions kept coming back every year with loans to the owners of the land that they can never pay back. Child labor is no exception as it's not in the interest of people in charge to enforce the law where it applies to poor people supplying cheap labor.

Souring prices of basic food ingredients like cooking oil, sugar, flour, etc. are the trigger for what's happening in Tunisia, Egypt, Bahrain, Yemen, Morocco and at least 20 more countries to follow. Plain greed and shortsightedness are the reasons that even in Thailand, with the best conditions to produce food, we can expect huge trouble over food prices!

[exbelg]

when the last tree is cut, when the last river is polluted, people will finally understand you cannot eat money ...

so using eatable palm oil for cars, cause problems in the food chain ...

[Nemo.]

Well as I see it the teal issue is that the planet can't support 6-10 billion people with high meat and energy consumption. So two choices

1. The west rapidly adopts renewable energy and invests tens of billions developing such technology. Part if this would include lower meat consumption as beef consumes 6 times the calories to feed us as the grain the cattle eat. And the methane they produce is a major global warmer

2. The west keeps consuming and 3-7 billion third world people die of starvation.

Considering the west is using the third world as effective slaves, like the slaves of the roman empire that did most if the productive work, to make one dollar t shorts etc, I'm guessing option 2 will be the one that happens.

It is no coincidence that revolutions in the middle east have occurred when food prices had risen so fast recently. Poor people facing starvation don't mind during anymore! In the west the raw material input cost is significantly lower % than in the third world. We in the west can afford to keep buying. So the poor will starve and revolt

Not a pretty future

[scotbeve]

In the Land Of Monopoly and many Daddy Warbucks, they have put Dep. PM in charge, have mercy!!!! Show us the $$$$$!!!!

[david555]

I understand that there is a shortage of palm oil because it is used in bio diesel.

But as of sudden there seems also to be a shortage of corn to make oil ,no sunflowers are growing anymore,farmers aren't growing rice anymore to make rice bran oil and the coconuts are also very rare because last time I looked the coconut oil was over 600 Baht a liter .

I do smell something but it isn't the smell of affordable oil for sure.

I the villagers keep doing that 6 months , there is no need for redshirt demonstrations anymore ......the Gov. collapses... but i do not think they can afford it to their selfs :jap:

[jamora]

Well as I see it the teal issue is that the planet can't support 6-10 billion people with high meat and energy consumption. So two choices

1. The west rapidly adopts renewable energy and invests tens of billions developing such technology. Part if this would include lower meat consumption as beef consumes 6 times the calories to feed us as the grain the cattle eat. And the methane they produce is a major global warmer

2. The west keeps consuming and 3-7 billion third world people die of starvation.

Considering the west is using the third world as effective slaves, like the slaves of the roman empire that did most if the productive work, to make one dollar t shorts etc, I'm guessing option 2 will be the one that happens.

It is no coincidence that revolutions in the middle east have occurred when food prices had risen so fast recently. Poor people facing starvation don't mind during anymore! In the west the raw material input cost is significantly lower % than in the third world. We in the west can afford to keep buying. So the poor will starve and revolt

Not a pretty future

"The power of population is so superior to the power of the earth to produce subsistence for man, that premature death must in some shape or other visit the human race. The vices of mankind are active and able ministers of depopulation. They are the precursors in the great army of destruction, and often finish the dreadful work themselves. But should they fail in this war of extermination, sickly seasons, epidemics, pestilence, and plague advance in terrific array, and sweep off their thousands and tens of thousands. Should success be still incomplete, gigantic inevitable famine stalks in the rear, and with one mighty blow levels the population with the food of the world".

T. R. Malthus, 1798 A.D.

[MaiChai]

Thailand is a big country and a high percentage of the land in the South is given over to palm oil production. So why has Thailand run out of palm oil? Well alot of it goes into bio diesel, but we assume the government promoting this took into account it would not affect food supplies?

We live in a commercial world. I suspect the more realistic answer is that someone is prepared to pay more than the government pegged price? If you have a choice of making less percent selling to the Thais or making more selling to others, which would you choose? There probably is no law that says producers must sell internally? That would go against free trade? Proves that pegging prices is not a good idea; let market forces prevail (assuming someone is not in a position to totally manipulate the market).

[surangw]

once the price goes up ( and people live with the increase) there will be an abundance

[david555]

if you catch the news you see that big china has a shortage of crofts because of droughts weather so , they are in need and a booming economy ......; they Will buy what they can get

[Ricardo]

If the world cannot support 8-10 billion people, then we have got to reduce the number of new mouths being born, the richer industrialised-economies are way-ahead of the curve on this, so they're already doing their part. Long-term solution but necessary.

If the locally-grown palm-oil is being exported or hoarded, because other people/countries will pay more for it, then the simplest answer is to let the price rise, as others have said that would soon see the resumption of retail-supply. The farmers would be glad to get a better price for their oil or rice or sugar, the problem is surely how to stop the middle-men from 'scooping the lot', PTP should but won't want to 'name & shame' given who their financial-supporters are.

Meanwhile governments, of whatever hue, like to appear to be in-control, if that were true then why did they let the price rise in the first place ? Perhaps a more-productive step, than the usual 'hub of hot-air' pronouncements, might be to command a temporary-cut in the percentage of 'bio' in 'bio-diesel' ?

Edited February 22, 2011 by Ricardo

[scotbeve]

Well as I see it the teal issue is that the planet can't support 6-10 billion people with high meat and energy consumption. So two choices

1. The west rapidly adopts renewable energy and invests tens of billions developing such technology. Part if this would include lower meat consumption as beef consumes 6 times the calories to feed us as the grain the cattle eat. And the methane they produce is a major global warmer

2. The west keeps consuming and 3-7 billion third world people die of starvation.

Considering the west is using the third world as effective slaves, like the slaves of the roman empire that did most if the productive work, to make one dollar t shorts etc, I'm guessing option 2 will be the one that happens.

It is no coincidence that revolutions in the middle east have occurred when food prices had risen so fast recently. Poor people facing starvation don't mind during anymore! In the west the raw material input cost is significantly lower % than in the third world. We in the west can afford to keep buying. So the poor will starve and revolt

Not a pretty future

"The power of population is so superior to the power of the earth to produce subsistence for man, that premature death must in some shape or other visit the human race. The vices of mankind are active and able ministers of depopulation. They are the precursors in the great army of destruction, and often finish the dreadful work themselves. But should they fail in this war of extermination, sickly seasons, epidemics, pestilence, and plague advance in terrific array, and sweep off their thousands and tens of thousands. Should success be still incomplete, gigantic inevitable famine stalks in the rear, and with one mighty blow levels the population with the food of the world".

T. R. Malthus, 1798 A.D.

Sad but true..... It's a shame that the so-called elite of the world have never had to go hungry just for a few days just to see what it's really like. :jap:

[Valentine]

Thailand is a big country and a high percentage of the land in the South is given over to palm oil production. So why has Thailand run out of palm oil? Well alot of it goes into bio diesel, but we assume the government promoting this took into account it would not affect food supplies?

We live in a nation of people who tend to look inwards rather than outwards & live for the day without much thought for tomorrow. Bio diesel was flavour of the month back then & now it seems unstoppable. BTW there are many other sources for bio diesel other than palm oil so to use it as an excuse for the shortage is simply not valid http://www.eia.doe.gov/oiaf/analysispaper/biodiesel/

[newtronbom]

Well as I see it the teal issue is that the planet can't support 6-10 billion people with high meat and energy consumption. So two choices

1. The west rapidly adopts renewable energy and invests tens of billions developing such technology. Part if this would include lower meat consumption as beef consumes 6 times the calories to feed us as the grain the cattle eat. And the methane they produce is a major global warmer

2. The west keeps consuming and 3-7 billion third world people die of starvation.

Considering the west is using the third world as effective slaves, like the slaves of the roman empire that did most if the productive work, to make one dollar t shorts etc, I'm guessing option 2 will be the one that happens.

It is no coincidence that revolutions in the middle east have occurred when food prices had risen so fast recently. Poor people facing starvation don't mind during anymore! In the west the raw material input cost is significantly lower % than in the third world. We in the west can afford to keep buying. So the poor will starve and revolt

Not a pretty future

"The power of population is so superior to the power of the earth to produce subsistence for man, that premature death must in some shape or other visit the human race. The vices of mankind are active and able ministers of depopulation. They are the precursors in the great army of destruction, and often finish the dreadful work themselves. But should they fail in this war of extermination, sickly seasons, epidemics, pestilence, and plague advance in terrific array, and sweep off their thousands and tens of thousands. Should success be still incomplete, gigantic inevitable famine stalks in the rear, and with one mighty blow levels the population with the food of the world".

T. R. Malthus, 1798 A.D.

Back in those days, they didn't have vaccines and modern medicine. Nature used to keep the levels pretty well, but now we can get around nature and we now face severe overpopulation. "Nemo" said the world can't support 6 to 10 billion people. He's right. What he didn't or wouldn't say, was that strict birth control in those countries who can't sustain their populations and rely on "aid" should have been imposed long ago. I don't need to name them. This would have done far more good than just pumping in more food and medicine. I agree that modern medicine can improve the quality of life so much and this is good, but only for a realistically sustainable population. Also healthy people suffer less disease anyway. Some here, maybe many, will say that what I propose is inhuman. Those are the people whose attitudes have caused this problem on earth today. I say get the population levels down, then spend the money that is now spent on food aid(and corruption), on education and giving them self worth and sustainable industry. After that it is up to them. With the rise in food prices now and the many shortages, food aid is going to suffer soon anyway.

[powderpuff]

Yeah there is zero corn oil in the supermarket today.

I don't care how Abhisit came to power. This is a core responsibility to insure this type of staples are in the market everyday.

If this moron can not organize a few ships to sail down to Kuala Lumpur to load up on palm oil & come back he needs to step down.

Thailand Land of one disaster followed by the next. Forget Amazing. Embarasment more like.

[oldsailor35]

Ban palm oil, whose rapidly expanding plantations are the main cause of deforestation in Southeast Asia, especially in Indonesia.

Avoid using palm oil; inspect all food labels for palm oil content and do not buy food containing it.

Save the planet, and not your own money through using cheap and nasty oil.

I suggest you learn more about it before you make such stupid remarks. Yes deforestation is going on in a big way in Malaysia and Indonesia. But not in Thailand.

[oldsailor35]

Well as I see it the teal issue is that the planet can't support 6-10 billion people with high meat and energy consumption. So two choices

1. The west rapidly adopts renewable energy and invests tens of billions developing such technology. Part if this would include lower meat consumption as beef consumes 6 times the calories to feed us as the grain the cattle eat. And the methane they produce is a major global warmer

2. The west keeps consuming and 3-7 billion third world people die of starvation.

Considering the west is using the third world as effective slaves, like the slaves of the roman empire that did most if the productive work, to make one dollar t shorts etc, I'm guessing option 2 will be the one that happens.

It is no coincidence that revolutions in the middle east have occurred when food prices had risen so fast recently. Poor people facing starvation don't mind during anymore! In the west the raw material input cost is significantly lower % than in the third world. We in the west can afford to keep buying. So the poor will starve and revolt

Not a pretty future

Hey Nemo, Grain is not a necessity for feeding beef cattle.

[oldsailor35]

In the Land Of Monopoly and many Daddy Warbucks, they have put Dep. PM in charge, have mercy!!!! Show us the $$$!!!!

Suthep in control of the Palm Oil industry, is like putting a fox in charge of the chicken pen. He is from Suratthani and he and his family are some of the biggest Palm Oil growers.

[bangon04]

if you catch the news you see that big china has a shortage of crofts because of droughts weather so , they are in need and a booming economy ......; they Will buy what they can get

One obvious solution would be to add junk products to the oil (like melamine or any old waste product oils) to make it go further and this will bring the price down to acceptable levels.

Alternatively Thais can keep cooking longer using the old oil until it is too black to see the food.

Alternatively Thais can start cooking using biodiesel.

All of the above would be easier for the government, even including the cost of healthcare, than trying to stamp out the corruption which is causing the shortage.

[powderpuff]

This is an old fashioned shakedown.

There is no shortage of oil.

As posted above once they double the price & the public eat that suddenly there will be ample supplies of oil, sugar, rice, cooking gas & other basic foodstuffs.

[ginjag]

Ban palm oil, whose rapidly expanding plantations are the main cause of deforestation in Southeast Asia, especially in Indonesia.

Avoid using palm oil; inspect all food labels for palm oil content and do not buy food containing it.

Save the planet, and not your own money through using cheap and nasty oil.

I suggest you learn more about it before you make such stupid remarks. Yes deforestation is going on in a big way in Malaysia and Indonesia. But not in Thailand.

So the main storage people are stockpiling, and stockpiling and hardley any nationwide distribution. Udon-big c--tesco yesterday. at tesco it said restricted to 1 litre per person. at the checkout the cashier said with supervser near-YES 1 per family..55555555555 I said if there are 10 in the house --1 only was the reply-- 555555555 so I said how do you know if the customer has a family.she did not reply. Then I said -oh !.if I go out of the shop-come in again for another purchace o.k. she said thats not allowed. so next time I,m going to take my father xmas outfit and change into that and return to buy. amazing

[rubl]

In the Land Of Monopoly and many Daddy Warbucks, they have put Dep. PM in charge, have mercy!!!! Show us the $$$!!!!

Suthep in control of the Palm Oil industry, is like putting a fox in charge of the chicken pen. He is from Suratthani and he and his family are some of the biggest Palm Oil growers.

Waiting for proof of what is suggested here. Maybe k. Chalerm who just asked for an hour on Thursday to grill the government will come with some interesting things. Mind you he might just want to annoy k. Mingkwan