Crude palm oil to be imported to save forex

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The Ministry of Trade and Industry which is not happy about spending half a billion USD to import palm oil from Singapore and Malaysia are consulting with 11 large local edible oil producers about ways to use ‘crude’ palm oil instead.
W.A. Oil Factory and Distributor, Hamaresa Edible Oil SC. Co., Belayneh Kindie Import and Export, Kana Industry and Trading, and Addis Modjo Edible Oil Complex Share Company are among the selected companies currently carrying out studies on how to use the ‘crude’ palm oil. When the companies start to refine the ‘crude’ palm oil Ethiopia will save at least USD 80 million per year by not importing packed edible oil form abroad.
Pulses and oilseeds are the second and third most important crops in Ethiopia, both in terms of land use and production. Palm oil covers 96 percent of the total consumption while only four percent of it is covered by a few domestic manufactures with a low level of production capacity as well as other importers. Last fiscal year, Ethiopia imported 73,434 liters of palm oil according to the data from Minister of Trade and Industry. However, Ethiopia mainly relies on imported palm oil from countries like Indonesia, Malaysia and Singapore in order to satisfy its edible oil consumption.
Kasahun Mulat, Trade Regulation and Inspection Director at the Ministry of Trade and Industry told Capital that importing crude oil will begin after these companies finish their feasibility study.
“We can’t continue like this. For a country which has big economic challenges, spending half a billion USD to import palm oil is too much. We are telling the companies to study capacity, techniques and the fair price of refining edible oil. So after they deliver their study to us we will look at it and if it is fair for the market and the consumer we will allow them to import the crude oil.”
Kassahun added that the government will look to assist farmers in planting large pulse and oilseed plants on suitable land to reduce edible oil imports.
“Importing the edible oil is just a short term plan but in the long run we have to grow more oilseeds. Producing crude edible oil here is our big vision which will create more jobs for many people in addition to stabilizing the market for edible oil which is currently dependent on imports,” he said.
Currently five private companies are importing palm oil; AHFA PLC, Biftu Adugna Business S.C., Al-Sam International, Belayneh Kindie Import & Export (BKIE), and Hameressa Edible Oil S.C.
Palm oil is one of the world’s most commonly used vegetable oils, present in around half of frequently used food and consumer products; from snacks to cosmetics. Worldwide production of the oil has increased from 15 million tons in 1995 to 66 million tons in 2017.