Exports of palm products, including oleo chemicals and biodiesel also dropped by 6 percent to 2.66 million tons in the corresponding period. 

“The drop in exports is more due to the rise in export duties to US$18 per ton in the second month. This made producers and traders delay their sales and purchases,” said GAPKI executive director Fadhil Hasan on Thursday press statement.

(Read also: Palm oil producers revise up palm oil production, stock data)

The drop in production combined with high exports, albeit lower than in January, reduced stocks by 32.5 percent to 1.93 million tons from 2.85 million tons.

However, exports to the Middle East rose significantly by 116 percent MoM to 224,730 tons in February. Exports to Bangladesh, China and African countries also increased by 23 percent, 9 percent and 3 percent respectively.

Exports to the United States declined by 46 percent MoM to 54,850 tons. Exports to the European Union, Pakistan and India dropped by 43 percent, 25 percent and 13 percent respectively.

GAPKI predicts CPO prices will stagnate at $680 to $720 per ton in the first two weeks of April after remaining at between $685 and $750 per ton throughout March and being higher at $725 to $820 throughout February.

The Indonesian government has issued an April CPO price reference of $762.88 per ton and consequently lowered export duties to $3 per ton. (bbn)

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