CPO export surges on lower export tax
JAKARTA (JP): Indonesia's monthly export volume of crude palm oil (CPO) and its by-products surged by 475 percent to 358,917 metric tons in February from 62,449 tons in January following the government's decision to lower the export tax imposed on CPO and its derivatives.
Data from Directorate General of Customs and Excise shows that the export value rose to US$819.88 million in February from $33.53 million in the previous month.
The sharp increase in export volume and value was due to the government's move to slash the export tax on CPO and its derivatives to as high as 40 percent from 60 percent starting Jan. 29.
The biggest increase was recorded in the exports of Refined Bleached Deodorized (RBD) Olein, which surged to 312,978 tons worth $798.37 million in February from 8,800 tons worth $5.84 million in January.
However, government receipts from the export tax in February dropped by 34 percent to Rp 61.18 billion from Rp 92.57 billion in January.
Indonesia's oil palm plantations are expected to yield six million tons of crude palm oil this year, up from the 4.9 million tons produced last year.
The Ministry of Industry and Trade said on Friday that it has decided to maintain the reference prices used to calculate the payment of export taxes on CPO and its by-products. The current reference prices will be effective until June 14.
The reference price of CPO is maintained at US$430 per metric ton. The reference price of oil palm kernel is set at $90 per ton, RBD palm oil is $435 per ton, crude palm olein is $445 per ton and RBD palm olein is $460 per ton.
The reference price of RBD palm olein in branded packs up to five kilograms is set at $520 per ton, while the reference price for crude palm stearin is $300 per ton. The new reference price for RBD palm stearin is $340 per ton, crude palm kernel oil $435 per ton, RBD palm kernel oil $460 per ton, crude coconut oil $440 per ton and RBD coconut oil $470 per ton.
The ministry said that the reference prices were maintained because there was no sharp fluctuation in the prices of CPO and its derivatives in the international market.
Coffee
In a similar development, the Association of Indonesian Coffee Exporters has urged the government to delay the implementation of the planned export taxes on primary products, especially coffee, due to declining prices in the international market.
The association's executive secretary, Noer Madjid, said coffee prices in the international market have shown a decreasing trend due to increasing production in main coffee producing countries like Brazil, Colombia as well as Indonesia.
"If the government continues its plan to impose an export tax, even though it is only 5 percent, many exporters will stop their activities because the business would no longer be profitable," he said.
Noer said local exporters are currently facing hardships because foreign buyers have asked for a discount.
Indonesian coffee exporters are also obliged to pay various levies for transportation and shipment, he said.
Noer said the various levies have lowered exporters' profit from about 30 percent in the 1990s to a current 5 percent.
He feared that the export tax would make Indonesia's coffee exports, which are facing tough competition from Vietnam, less competitive in the international market.
Minister of Industry and Trade Rahardi Ramelan said earlier this month that the government planned to impose an export tax on primary products such cocoa and coffee in a bid to encourage local downstream industry and to boost exports of more value- added secondary products.
Indonesia, the world's number three coffee producer, after Brazil and Colombia, is expected to produce 470,000 tons of coffee this year, an increase from 430,000 tons last year.
The country's coffee exports are estimated to reach 350,000 tons this year, up from 325,000 tons last year. (gis)