Indonesia removes export levy
Indonesia has scrapped its export levy for all palm oil products until August 31 in a fresh attempt to boost exports and ease high inventories, finance ministry officials said on Saturday, adding the move would not disrupt government revenues. The decision by the world’s biggest palm oil exporter could further depress prices, which have fallen by about 50% since late April to their lowest in over a year. Indonesian palm oil producers have been struggling with high inventories since the country imposed a three-week export ban through to May 23 to reduce domestic cooking oil prices. Since lifting the ban, Jakarta has implemented rules on mandatory local sales – known as the domestic market obligation (DMO) – to keep produce at home to be made into cooking oil. At the same time, it has tried to clear up storage tanks by cutting export taxes and launching a shipment acceleration programme, but exports remained slow and companies have blamed the DMO rules, as well as problems with securing cargo vessels.
Published in The Express Tribune, July 17th, 2022.
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