JAKARTA (TheInsiderStories) – Trade ministry of Indonesia set the export levy of crude palm oil (CPO) and derivative products for in January at US$74 a metric ton (MT) of CPO after the price rose to $951.86. The benchmark price increased by 9.31 percent compared to December at $870.77 per MT of CPO.
“With the (new) reference price, the government put the export levy $74 per MT for the January 2021, ”said the director general at trade ministry, Didi Sumedi, in an official statement released today (01/04).
He added, this value is much higher than previous month amounting to $33 per MT of CPO. The ministry also decided the benchmark price for cocoa beans was $2,637.93 a MT, or up 9.89 percent from December worth of $2,400.58 per MT. He stated, that the new price has an impact on the reference price of cocoa beans for export up 10.92 percent from $2,116 per MT to $2,347 a MT.
The increased of CPO was due to the continued strengthening of international prices, while for seeds cocoa started to rise after decreasing since November 2020. However, its not give an impact to the export levy for cocoa beans by 5 percent, same with the November 2020. In addition, said Sumedi, the benchmark price and export levy for wood products and leather products did not change from December.
End of last year, the government announced to implement the progressive export levy CPO from earlier maximum $55 a MT of CPO to as much as $180 per MT of CPO, showed by the finance ministry regulation. This policy has been taken in order to maintain the sustainability of the mandatory 30 percent biodiesel-used (B30) following the increase in world palm oil prices.
Last October, senior minister for economic affairs, Airlangga Hartarto, stated, “It has been decided, the palm oil export tax rate increased by $12.5 per MT and for downstream products, the tariff will increase by $10 per ton, with the assumption that each increase in the price of palm oil is $25 a MT.”
He revealed, the the world’ largest palm oil producer, is expanding its biodiesel program based on palm oil in order to cut the energy imports and to minimize the price difference between the biodiesel made from palm oil and a diesel price.
Hartarto said, when the B30 takes effect, is projected that the use of CPO will increases and push the prices up. He estimating the CPO use during the application of B30 will rise to around 3 million MT of CPO.
Accordance to Minister of Finance Regulation Number 23 of 2019, if the CPO price is above $570 a ton, a CPO and derivatives will be levied 50 percent. But, if the Prices above $620 a ton are subject to 100 percent full of levies. Last year, the country has implement zero export levy for palm oil products to protect the domestic palm oil industry from falling prices due to flagging exports and excess supply in the market.
In this month, the government set the reference prices for CPO dan derivative products for export at $782.03 per MT of CPO. The benchmark price is increased by 1.70 percent compared to October at $768.98 MT of CPO.
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