Farmers Request Review of 12.5% CPO Export Levy Amid Volatile Global Situation
Jakarta – The government’s flat 12.5% export levy on crude palm oil (CPO) has drawn scrutiny amid uncertain global conditions. Industry players and farmers believe the policy could suppress upstream prices if international prices decline sharply.
Apkasindo Secretary General Rino Afrino argued that the policy requires evaluation if actual prices diverge significantly from the government’s initial projections.
“The irony is that the 12.5% applies at the same time. This is a projection that does not account for escalation factors from wars,” said Rino.
He noted that the flat levy scheme differs fundamentally from the previous progressive system that adjusted with price increases.
“Previously, it was a sliding scale – with each $100 price increase, the levy rose by a corresponding amount. Now it is flat-rate: regardless of CPO prices, it is always 12.5%,” he explained.
According to him, this scheme is relatively safe when prices are high but becomes burdensome when global prices decline.
“If the world average is around $1,275 or $1,375 per tonne in Rotterdam, a 12.5% deduction might not be problematic. But if prices collapse and the 12.5% remains flat, we will certainly request an adjustment,” he asserted.
On another note, Rino acknowledged that he does not want fresh fruit bunch (TBS) prices to become excessively high as this would drive up cooking oil prices and other essential commodity costs.
“I am someone who does not aspire to TBS prices at 5,000 rupiah per kilogramme. If TBS reaches 5,000 rupiah, what becomes of CPO prices? What happens to cooking oil prices? Farmers smile, whilst housewives protest,” he said.
He argued that the government faces a difficult position as it must balance export prices with domestic stability.
“The country fights anomalies – externally prices are very high but internally, for domestic consumption, we set prices at a certain level. How do you manage that? It is not easy,” he noted.
For this reason, he hopes the government will respond promptly if market conditions change drastically due to escalation of global conflicts.
“If projections prove incorrect and prices fall, naturally we will request that the 12.5% levy be reviewed,” said Rino.
Finance Minister Purbaya Yudhi Sadewa established the new plantation fund levy rate on palm oil, crude palm oil, and derivative product exports yesterday.
The new tariff was outlined in Ministry of Finance Regulation (PMK) No. 9 of 2026, which revised PMK 69/2025. This regulation took effect two days after publication on 27 February 2026, or from 2 March 2026.
“To enhance the productivity of plantation products and provide added value to downstream products at the farmer and industry level, an adjustment to the plantation fund levy rate on palm oil exports, crude palm oil, and derivative products is necessary,” quoted from PMK 9/2026, Tuesday (3 March 2026).