India again raises CPO tariff barrier
India again raises CPO tariff barrier
Zakki P. Hakim, The Jakarta Post, Jakarta
India increased on Thursday its base import price for crude palm
oil to US$423 per ton from $400 a ton, thus making it more
difficult for Indonesian crude palm oil (CPO) to enter the Indian
market.
Minister of Trade Mari E. Pangestu said on Thursday that the
government would continue negotiating with India for the latter
to reduce the entry tariff barrier.
India set base prices for edible oils used for calculating the
import duties of the commodities. The base prices are set in line
with the global rate and are used instead of the actual landed
costs of the oils.
"I have just received the news (of the raise) this afternoon,"
Mari said, adding that India also increased the base price for
crude soybean oil, a main substitute and competitor for CPO.
India increased crude soybean oil to $558 per ton from $535 a
ton.
Separately, the ministry's director for bilateral cooperation
Deddy Saleh said Mari would lead a delegation, including private
sector representatives, to India to talk on the reduction of the
tariff barrier, among other subjects.
The Indian government raised in February its CPO import duty
from 65 percent to 80 percent to protect its soybean and
sunflower farmers, as both plants yield edible oil that is a
substitute for CPO.
At the same time, India reduced CPO base prices from $454 per
ton to $400 a ton, while maintaining soybean base prices at $565
a ton. Later, on March 1, India lowered soybean base prices to
$485 per ton, thus making it more interesting for Indian
importers to bring in soybeans rather than CPO, Deddy said.
Furthermore, coinciding with Minister of Agriculture Anton
Apriyantono's visit with his counterpart in New Delhi mid this
month to negotiate a lower tariff, India once again increased the
soybean base price to $535 per ton, he said.
"India's moves implied that they were increasing the tariff
barrier for soybeans to the level for CPO, whereas in fact the
barrier is still significantly higher for CPO," Deddy said.
Indonesia is the world's second largest exporter after
Malaysia of palm oil -- a raw material for, among other products,
cooking oil, soaps and detergents.
Output from the two countries is expected to make up about 85
percent of this year's global palm oil production.