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Govt to cut CPO export duty to 15% in May
The government will cut the crude palm oil (CPO) export duty for May to 15 percent, on a decline in the commodity price in the international market, Trade Minister Mari Elka Pangestu says
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The government will cut the crude palm oil (CPO) export duty for May to 15 percent, on a decline in the commodity price in the international market, Trade Minister Mari Elka Pangestu says.
"The trigger (for May's cut) is that the international price of CPO is now at an average of US$1,158 per ton. So the export tariff for May will be lower by 5 percent at 15 percent," Mari said Sunday.
In April, the duty was set at 20 percent, up from 10 percent a month earlier, after the international price of CPO in March stayed above $1,200 per ton, reaching a high of $1,395 per ton.
The calculation for the export duty for the coming month is largely determined by the average price of CPO in the previous month.
Under the ministry's so-called "progressive" export duty, CPO with a price of between $1,100 and $1,200 per ton will be charged a duty of 15 percent per ton.
The duty will increase to 20 percent if the price is between $1,200 and $1,300, and to 30 percent if the price exceeds $1,300 per ton.
Mari said falling prices were also seen in CPO derivatives products, including crude olein to $1,225 from 1,288, RBD palm olein from $1,303 to $1,129, and RBD palm oil from $1,260 to $1,207.
The price for biofuel increased from $1,035 to $1,052 for May.
According to the Central Statistics Agency, exports of CPO and its derivatives fell by 34.85 percent to US$1 billion in February from $1.6 billion in January.
However, the Indonesian Palm Oil Association predicts that for full-year 2008, CPO exports will increase by around 27 percent.
The association says the country will produce 18.4 million tons of CPO this year, with 4 million tons set to be consumed domestically, mostly as raw material for cooking oil. Around 300,000 tons will be used in biodiesel projects, while the remaining 14 million tons will be exported.
