Indonesia palm oil group GAPKI urges government to delay levy hike
Indonesia is due to raise its palm oil export levy to between 4.75% and 10% from May 17 to help fund a biodiesel blending mandate as well as a palm oil replanting programme. The levy currently stands at 3% to 7.5%.
'The situation is full of uncertainties and it is a big risk to launch a policy that will impact competitiveness of Indonesia's palm oil exports,' GAPKI said in a letter addressed to Finance Minister Sri Mulyani Indrawati.
A spokesperson for the palm oil fund that collects the levy said GAPKI's request will be discussed at a meeting with government ministries next week. The finance ministry and coordinating ministry of economic affairs did not respond to a request for comment.
Indonesia, the world's biggest palm oil producer, is facing proposed U.S. tariffs of 32%, while number two producer Malaysia faces a 24% rate. The tariffs have been put on hold until July.
'It is feared that this will make Indonesian palm oil exports increasingly uncompetitive compared to Malaysia, especially for the U.S. market which is currently dominated by Indonesia,' the group said.
Palm ends with third straight weekly loss
Malaysia charges an export duty of between 3% and 10%, depending on the price of palm oil. For May, the duty has been set at 10%.
Sri Mulyani Indrawati said previously that Indonesia would adjust its crude palm oil export tax to reduce the burden on exporters from U.S. tariffs. The tax is separate to the levy.
Meanwhile, heightened tension between major palm oil buyers India and Pakistan has sparked concern about reduced demand, GAPKI said.
'There is no permanent ceasefire between India and Pakistan yet that had caused buyers from both nations to delay purchase of crude palm oil and its derivatives,' the group added.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
2 days ago
- Business Recorder
Asian currencies fall
BENGALURU: Stock markets in emerging Asia were headed for their best week in several months on Friday, driven by optimism around trade deals with the United States, and an increasingly dovish tilt at regional central banks. The MSCI gauge of emerging Asia stocks touched its highest in more than three years and was set to end the week 1.6% higher. Stocks in Taiwan, which make up over a fifth of the index, rose 1% to a more than four-month high. TSMC, the world's largest contract chipmaker, rallied more than 2% after posting a record quarterly profit on Thursday. An MSCI index of ASEAN equities, dominated by Singapore, surged to a more than nine-month high. Singapore's stocks touched a record high for the tenth straight day, which also marks its longest ever rally. Indonesian equities jumped more than 1% to an over seven-month peak, led by data centre service provider DCI Indonesia, which surged over 16% to a record high, and Barito Renewables Energy, which gained about 8%. A trade deal with the US at a lower than previously announced tariff rate, alongside an increasingly dovish stance by the central bank, has helped drive inflows into equities. Domestic investors have net bought 6.21 trillion rupiah ($380.86 million) so far this month, as per exchange data. In Thailand, the benchmark index rose 1%. It has surged almost 7% for the week and was set for its biggest gain since June 2020, driven by inflows on news of the government proposing a new central bank chief with a dovish bias. Elsewhere, Malaysian stocks jumped 0.4%, while those in the Philippines ticked marginally higher. India's Nifty 50 slipped 0.7% to a more than three-week low.
Express Tribune
5 days ago
- Express Tribune
Pakistan, Indonesia discuss defence ties
Listen to article Indonesia's Defence Minister Lt Gen (retired) Sjafrie Sjamsoeddin expressed his country's desire to boost defence ties and explore possible collaboration in defence production as he met the country's top civil and military leadership Gen Sjamsoeddin called on PM Shehbaz at the PM Office today, where he reiterated Indonesia's desire to "further strengthen defence ties with Pakistan and to explore possible areas for cooperation, especially in defence production", according to a statement from government-run PID. The Indonesian minister conveyed the best wishes of President Prabowo Subianto for the prime minister and people of Pakistan, the press release added. Meanwhile, PM Shehbaz "reaffirmed Pakistan's commitment to explore and expand collaboration with Indonesia in joint ventures of investment in mutually beneficial projects", the statement said. The prime minister also reiterated Pakistan's commitment to enhance bilateral cooperation with Indonesia in all avenues, including economic, strategic and trade sectors, along with defence and defence production. He highlighted that Pakistan and Indonesia enjoyed a "longstanding friendship rooted in shared cultural, religious and historical bonds, supporting each other at international forums". Both sides stressed the importance of "enhancing multifaceted bilateral cooperation", according to the PID. "The meeting underscored the deep-rooted historical, brotherly and friendly bilateral relations between Pakistan and Indonesia," the statement noted. Recalling his meeting last year with Indonesia's President Prabowo Subianto on the sidelines of Developing-8 Summit in Cairo, PM Shehbaz conveyed his best wishes for the Indonesian president. The prime minister also reviewed ongoing initiatives under the Pakistan-Indonesia Defence Cooperation Agreement and agreed to "accelerate the implementation of key areas of mutual interest", the PID added. Meeting with COAS Indonesian Defence Minister Lieutenant General (Retd) Sjafrie Sjamsoeddin met with Chief of Army Staff (COAS) Field Marshal Asim Munir at the General Headquarters (GHQ) in Rawalpindi on Tuesday to discuss strengthening military ties, the military's media wing reported. According to a statement issued by the Inter-Services Public Relations (ISPR), the Indonesian defence minister, who is leading a delegation of senior representatives from various military and intelligence agencies, held wide-ranging talks with Pakistan's top military leadership. Both sides exchanged views on regional security, defence cooperation, and avenues to enhance bilateral military collaboration. The meeting underscored the longstanding friendship between the two nations, with particular emphasis on mutual cooperation to ensure peace and stability in the region. Field Marshal Munir highlighted the importance of mutual cooperation in maintaining peace and stability in the region. The Indonesian minister, in turn, appreciated the professional achievements of the Pakistan Army, particularly its role in the fight against terrorism.
Business Recorder
5 days ago
- Business Recorder
Trump says Indonesia to face 19% tariff under trade deal
WASHINGTON: President Donald Trump said Tuesday that he had struck a trade pact with Indonesia resulting in a lower US tariff on the country's goods than earlier threatened, alongside better market access. 'Great deal, for everybody, just made with Indonesia,' Trump wrote on his Truth Social platform, saying that he worked with the country's president directly. He later told reporters that Indonesia was 'giving us access' and that goods from the Southeast Asian country would face a 19 percent tariff. Trump did not elaborate on the improved access that he had touted, although he stressed that Indonesia is 'very strong on copper' and other materials. The Trump administration has been under pressure to finalize trade pacts after promising a flurry of deals, as countries sought negotiations with Washington to avoid Trump's tariff threats. But the US president has so far only unveiled deals with Britain and Vietnam, alongside an agreement to temporarily lower tit-for-tat levies with China. EU and Indonesia announce 'political agreement' on trade deal Last week, Trump renewed his threat of a 32 percent levy on Indonesian goods, saying in a letter to the country's leadership that this level would take effect August 1. It remains unclear when the lower tariff level announced Tuesday will take effect for Indonesia. 'We have a couple of those deals that are going to be announced. India basically is working along that same line,' Trump told reporters Tuesday, referring to market access. Indonesia's former vice minister for foreign affairs Dino Patti Djalal told a Foreign Policy event Tuesday that government insiders had indicated they were happy with the new deal. Tariffs drive Trump in April imposed a 10 percent tariff on almost all trading partners, while announcing plans to eventually hike this level for dozens of economies, including the European Union and Indonesia. But days before the steeper duties were due to take effect, he pushed the deadline back from July 9 to August 1. This marked his second postponement of the elevated levies. Instead, since early last week, Trump has been sending letters to partners, setting out the tariff levels they would face come August. To date, Trump has sent more than 20 such letters including to the EU, Japan, South Korea and Malaysia. Canada and Mexico, both countries that were not originally targeted in Trump's 'reciprocal' tariff push in April, also received similar documents outlining updated tariffs for their products. But existing exemptions covering goods entering the United States under a North American trade pact are expected to remain in place, a US official earlier said. Trump has unveiled blanket tariffs on trading partners in part to address what his administration deems as unfair practices that hurt American businesses. Analysts have warned that without trade agreements, Americans could conclude that Trump's strategy to reshape US trading ties with the world has not worked. 'In the public's mind, the tariffs are the pain, and the agreements will be the gain. If there are no agreements, people will conclude his strategy was flawed,' William Reinsch, senior adviser at the Center for Strategic and International Studies, previously told AFP.
