Indonesia to tighten palm oil export rules

Indonesia will tighten export rules for palm oil from January 1 by allowing fewer shipments overseas for every tonne sold domestically.

The move aims at ensuring sufficient domestic supply of the product.

Exporters will be allowed to ship six times their domestic sales volume, less than the current ratio of eight times, according to a new regulation.

A senior official at the Coordinating Ministry for Maritime and Investment Affairs, Septia  Hario Setio said on Friday that the move was “to secure domestic supply, especially for the first quarter of 2023.”

Seto said the ratio will be evaluated periodically by considering the domestic situation, including cooking oil availability and prices.

Earlier this year, Indonesia introduced export measures on palm oil products amid concerns about cooking oil prices spiralling out of control.

In a meeting with the government last week, Indonesian Palm Oil Association (GAPKI) Secretary General, Eddy Martono said there were still concerns about cooking oil supply, related to the government’s biodiesel programme and expectations of lower palm oil output in the first quarter.

“Indonesia is planning to increase the mandatory palm oil component to 35 percent starting February 1.

“While businesses would comply with the regulation, the new export ratio should be evaluated regularly in the short term,” he said.

Aljazeera/Hauwa Abu