Exposing the Under-Invoicing Scheme: Why Palm Oil Giants Are Suspected of Manipulating Export Prices?
Indonesia as the world’s largest crude palm oil (CPO) producer is once again shaken by international trade integrity issues. In May 2026, Finance Minister Purbaya Yudhi Sadewa explicitly named two industry giants, Wilmar International Limited and Musim Mas Group, among 10 companies suspected of manipulating export valuations. The allegations are not merely administrative but pose a serious threat to state revenue from the key commodity sector.
According to Finance Ministry findings, the primary method used is under-invoicing via transfer pricing. Indonesian companies are suspected of selling CPO to their own trading companies or affiliates in Singapore at prices significantly below international market rates.
Ship tracking data shows that although documents record sales to Singapore, the physical goods are often sent directly to the final destination. In Singapore, the ‘paper’ prices are substantially increased before being billed to the end buyer. This massive price discrepancy is allegedly parked overseas, resulting in suboptimal collection of Income Tax (PPh), Export Duty (Bea Keluar), and Export Levy (PE) for the national treasury.
As dominant players controlling the supply chain from upstream to downstream, Wilmar and Musim Mas possess highly efficient global logistics infrastructure. However, this dominance also places them under strict scrutiny by competition and financial authorities.
The case echoes the 2022 cooking oil crisis. Economic observers note that the oligopolistic CPO market structure allows large firms to control price information flows. Opaque intra-group transactions present a challenge that requires advanced data audit technology to penetrate.
Under-invoicing involves reporting lower values on export invoices than the actual transaction price to evade percentage-based taxes or levies.
Although manipulation occurs at the export level, Fresh Fruit Bunch (TBS) prices for farmers often reference domestic prices influenced by reported export values. Systematic under-reporting of export prices risks depressing farm-level purchase prices.
In 2026, the government is using National Single Window (NSW) data integration and artificial intelligence (AI) to compare Indonesian exporters’ reported prices with destination market prices in real time.
The government, through the Finance Ministry and Attorney General’s Office, has stated that proven manipulators must repay all outstanding obligations to the state. There are also discussions to establish a specialised body to oversee the centralised export of strategic commodities via PT Danantara Sumberdaya Indonesia (DSI) to close future transfer pricing loopholes.
Wilmar is strengthening youth workforce readiness through internship programmes, bridging education and industry needs.
Wilmar remains committed to youth character development via anti-bullying awareness campaigns in schools near its operational areas.
Besides employees’ children, Bina Bangsa School also provides access for the public. Currently, 380 village children attend Bina Bangsa.
Wilmar has been awarded the Setara Institute Award as an Early Adopting Company for business and human rights practices with a B rating.
The Attorney General’s Office has denied Wilmar International Limited’s claim regarding a guarantee related to the Rp11.8 trillion seized by investigators.