Image: Reuters Berita 24 English -To promote exports, Indonesian Trade Minister Muhammad Lutfi stated on Tuesday that the government would r...
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| Image: Reuters |
Berita 24 English -To promote exports, Indonesian Trade Minister Muhammad Lutfi stated on Tuesday that the government would reduce the combined maximum crude palm oil export and levy rate to $488 per tonne from $575 per tonne.
After a three-week prohibition, Indonesia, the world's largest producer of palm oil, has permitted exports to restart, but progress has been slow owing to red tape, keeping palm mills' storage tanks full.
Farmers have complained that palm fruit prices have remained low as mills continue to limit their purchases.
According to Lutfi, the government will boost the maximum tax to $288 per tonne while lowering the maximum charge to $200 per tonne. Indonesia presently levies an export tax of up to $200 per tonne and a fee of up to $375 per tonne.
The increased levies will be implemented at a later date, according to Lutfi.
According to Trade Ministry senior official Oke Nurwan, the present overall tax and levy rates are "burdensome."
He told reporters, "Exports must flow since storage tanks are full."
Indonesia banned the export of crude palm oil and some of its derivatives for three weeks starting April 28 in an effort to curb rising domestic costs of palm oil-based cooking oil.
To maintain a steady supply of palm oil in the United States once the prohibition was lifted, the government implemented a program requiring producers to sell a percentage of their products to the domestic market before being awarded export permits.
After a number of palm oil mills stopped buying palm fruits from farmers, industry groups have asked the government to approve a larger export limit during the transition time to free up storage.
When asked about the request, Lutfi replied that "we are examining" it. Companies are authorized to export five times the quantity they sell locally, according to him.
