CPO producers urge government to lift export ban<\/p>\n
JAKARTA (JP): The Indonesian Palm Oil Producers Association
\nhas said the new agreement between the International Monetary
\nFund and the government, to be signed this week, should include
\nthe revoking of the export ban on crude palm oil (CPO) and most
\nof its derivatives.<\/p>\n
The association's chairman, Derom Bangun, said Saturday that
\nthe export ban on CPO and its derivatives over the past three
\nmonths had caused the country to miss out on huge foreign
\nexchange revenue.<\/p>\n
Therefore, he said, the association urged the government and
\nthe IMF, which are currently renegotiating a reform program in
\nexchange for a multibillion dollar bailout package, to lift the
\nban soon.<\/p>\n
\"All palm oil producers are anxiously waiting for the result
\nof the current meeting between IMF and the government,\" Derom
\ntold The Jakarta Post.<\/p>\n
An IMF team and the government are currently holding talks on
\neconomic reforms the country should adopt in return for a new
\nloan package from the fund.<\/p>\n
Indonesia banned the export of CPO and most of its derivatives
\nin January to stabilize domestic prices which had soared because
\nof the tumbling rupiah.<\/p>\n
Under the January agreement with the IMF, the government
\npromised to lift the ban this month, but later back tracked for
\nfear that palm oil producers would export most of their products
\nto cash in on the soaring international prices.<\/p>\n
CPO at present sells at US$650 per ton on the world market
\nagainst $250 per ton on the domestic market.<\/p>\n
Derom said the country's CPO production was projected to
\nincrease by 11.32 percent to 5.9 million tons this year, of which
\nonly 3.5 million could be absorbed by the domestic market.<\/p>\n
He said the export of the remaining 2.8 million tons could
\ngenerate a revenue of $1.2 billion.<\/p>\n
Derom said his association had recently proposed that the
\ngovernment devise an alternative scheme to the export ban.<\/p>\n
He suggested that under the scheme, palm oil producers be
\nallowed to export 25 percent of their CPO and 50 percent of their
\nolein and refined bleached deodorized (RBD) product and sell the
\nremainder domestically to help stabilize prices.<\/p>\n
Palm oil producers were obliged to pay export taxes of between
\n12 percent and 18 percent for CPO, olein and RBD.<\/p>\n
\"The export tax should be reduced to lure palm oil investors.
\nIn Malaysia, the export tax is only between 14 percent and 16
\npercent,\" he said.<\/p>\n
According to Derom, the association also proposed that the
\ngovernment maintain the tax exemption on stearin exports to add
\nto palm oil producers' revenues.<\/p>\n
\"We made the proposal because we heard the government planned
\nto impose export tax on stearin,\" Derom said.<\/p>\n
The government earlier banned the export of stearin until Feb.
\n28, after which it allowed palm oil producers to export 60
\npercent of their stearin exempt from tax.<\/p>\n
Stearin -- a byproduct of CPO -- is used by bakers and
\nchocolate makers.<\/p>\n
According to Derom, one kilogram of CPO produces 720 grams of
\nolein, 220 grams of stearin and 40 grams of fatty acid.<\/p>\n
State Logistics Agency chairman Beddu Amang suggested on
\nThursday that tax on crude palm oil exports should be 60 percent
\nafter the export ban was lifted. He did not elaborate.<\/p>\n
Some traders said such a rate would be too high, adding that
\nthe tax should be between 40 percent and 50 percent.<\/p>\n
Rumors that the export ban would be soon lifted pushed up
\ndomestic prices of olein, according to traders.<\/p>\n
Sources said that Minister of Industry and Trade Mohamad \"Bob\"
\nHasan was upset about the increasing prices of palm oil and he
\nwas likely to maintain the export ban for some time. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/cpo-producers-urge-government-to-lift-export-ban-1447893297",
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