Indonesia to review export levies for crude palm oil

The Indonesian government is contemplating a review of the 7.5% export levy on Crude Palm Oil (CPO) to balance farmer welfare and global competitiveness of CPO prices. This review could potentially change the current export levy policy, with the outcome dependent on the review process. The finance minister signed a policy imposing a 7.5% export levy on CPO in September 2024. The Central Statistics Agency reported a 26.39% annual decrease in Indonesia’s CPO exports in August 2024, attributed to less competitive palm oil prices and global economic challenges.

The Indonesian government is considering a review of the export levy on Crude Palm Oil (CPO), currently set at 7.5%. Dida Gardera, Deputy of Food and Agribusiness Coordination at the Coordinating Ministry for Economic Affairs, said that a review is necessary to ensure two key factors: increasing farmer welfare through higher Fresh Fruit Bunch (FFB) prices and maintaining competitive CPO prices at the global level. “The export levy should indeed be regularly evaluated,” said Dida when met at the discussion on palm oil at Hotel Bidakara, South Jakarta, Monday, November 18, 2024. Dida emphasized that the relatively stable domestic production and export of CPO, coupled with rising palm oil prices, indicate sufficient price competitiveness. He did not deny that a review may lead to changes in the CPO export levy policy but the outcome remains uncertain. The evaluation, he went on, aims to balance domestic needs and the financial health of the Palm Plantation Fund Management Agency. ...