Thailand: Border alert for palm oil smuggling from Malaysia

Trade officials along the border with Malaysia have been instructed to closely monitor the movement of cooking palm oil from Malaysia as high prices in Thailand attract smugglers.

Udom Srisomsong, director-general of the Internal Trade Department, said provincial commerce office chiefs in Songkhla and Satun had been ordered to prevent palm oil smuggling from Malaysia.

They had examined the movement of palm oil through border checkpoints over the weekend, the Public Relations Office in Satun said on Monday.

Random checks are also reportedly being made at sales outlets nationwide.

The precaution follows a demand-driven hike in palm nut prices due to dry weather, which in turn leads to a rise in the retail price of cooking oil. Palm nut prices rose from 5.60 baht per kilogramme to 8-9 baht in October,  according to Bank of Thailand and Prince of Songkhla University data.

Cooking palm oil currently retails for about 50 baht per litre bottle, an increase from last month.

In Malaysia, palm oil for cooking costs about 2.5 ringgit (about 20 baht) per bottle, kept down by a state subsidy to help low-income people. It is sold for up to 5 ringgit (39 baht) in Thailand, Malaysia’s The Sun newspaper quoted Azman Ismail, chief of the Ministry of Domestic Trade and Cost of Living in Kelantan state, as saying last month.

Malaysian authorities were also concerned about smuggling due to the price difference between the two countries, he added.

In Thailand, any movement at all of more than 25kg of palm oil requires approval from provincial trade authorities, with fines of up to 100,000 baht and/or up to five years in prison for violations.

The Commerce Ministry is seeking cooperation from wholesalers and retail stores to maintain the retail price of bottled palm oil, to help consumers.

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Tags: prices, Thailand, Malaysia, palm oil, cooking oil, border, palm nut