20/02/2011 (AsiaOne) - Deputy Prime Minister Suthep Thaugsuban, who chairs the national palm-oil policy committee, yesterday pledged to come up with effective measures to solve the acute shortage of cooking oil next week.

"We'll have to investigate what has happened. If the Commerce Ministry cannot import [more palm oil to ease the domestic shortage], we may have to allow the private sector to do so.

"The committee will meet on Tuesday to discuss this issue," he said.

Suthep brushed aside allegations that he himself was among the beneficiaries of the palm-oil shortage.

Officials from the Department of Special Investigation (DSI) will today search the factories of at least two major cooking-oil companies suspected of hoarding the first lot of 30,000 tonnes of palm oil imported into the country recently.

Tarit Pengdit, the DSI director-general, said hoarding had caused the severe shortage of cooking oil in the country and led to exorbitant prices.

A total of 10 companies were earlier awarded quotas from the first 30,000 tonnes of imported palm oil. However, a big portion of that oil has disappeared from the market.

Industry sources said some of the imported palm oil was also hoarded by biodiesel retailers, as it fetches a higher price when blended as biodiesel.

At present, the government promotes the use of biodiesel B3 and B5, which have 3-per-cent and 5-per-cent palm-oil content respectively.

In addition, edible-oil companies have hoarded the commodity in hopes of selling bottled cooking oil at a higher price later on. They bottled the imported palm oil but did not distribute it to retailers under the government's price-control programme.

Tarit said DSI officials would examine inventories and other data to determine the flow of imported palm oil so as to take action against those who have hoarded it.?

Pol Colonel Narat Savetanan, the deputy DSI chief, said the DSI and the Department of Internal Trade would enforce rules and regulations on price controls and hoarding.

Earlier, the Department of Internal Trade reported that there was no hoarding of cooking oil at major retail outlets.

Chatchai Chookaew, an adviser to the Commerce Ministry, said he hoped the DSI would take "straightforward action" so that the culprits behind the shortage were not allowed to get away with it.

Industry sources said there were four companies that were allocated imported palm oil but had not bottled the cooking oil for retail sales at a price of Bt47 per litre as agreed earlier with the government.

These firms use the Kesorn, Yok, Waew and Raja brands.

Altogether, they got 12,850 tonnes of palm oil, enough to bottle 9.8 million litres of cooking oil. As a result of their alleged action, the supply of bottled cooking oil is insufficient.

In the first shipment of 30,000 tonnes, the import price of palm oil was Bt39.57 per litre. It is estimated that 30,000
tonnes of palm oil would be enough for 22.8 million 1-litre bottles.

Hoarders stand to make hefty profits from selling the product later amid rising commodity prices in the world market.

Given that the domestic shortage is still acute, the Suthep committee wants to the Commerce Ministry to import another 120,000 tonnes of palm oil quickly.

Of this additional import, major food companies such as instant-noodle makers will get 20,000 tonnes, while small and medium-sized enterprises will get 10,000 tonnes.

The remaining 90,000 tonnes will be distributed for household consumption.